Sales order base price determination rules (preview)

[This article is prerelease documentation and is subject to change.]

This article describes the price determination rules for calculating the sales order base price.

Terms	Definition, usage, and notes	Price component type
Unit price	The price that's calculated for each unit in a sales order. It's calculated by using the following formula: Unit price = Base price ± Margin component price adjustments.
Base price	The basis for price adjustments. It's intended for all customers and is the standard rate for general purposes. If there's an applicable sales trade agreement price, the base price is the sales trade agreement price. If there's no applicable sales trade agreement price, the base price is the item base price.
Sales trade agreement price	The price that reflects a negotiated pricing strategy for a collection of customers and a group of specific products. You can configure the system so that it uses one of the following formulas to calculate the unit price based on the sales trade agreement price: Unit price = Sales trade agreement price (if no margin component price adjustment applies) Unit price = Sales trade agreement price ± Margin component price adjustments	Sales trade agreement
Item base price	The Item base price page lets you set prices for each item by using either calculated values or manually entered values. Calculated prices use the following formula: Item base price = Vendor list price ± Vendor term agreements.	Any of the following: Base price - purchase price Base price - inventory price Base price - sales price
Standard cost	The cost version of an item that's calculated by using the standard cost model.	Base price - inventory price
Margin component price adjustments	You can set up layers of margin components to adjust the base price up (positive) or down (negative). Margin component price adjustments have a calculation sequence and can be compounded to get the total adjustment price.	Margin component
Sales agreement	Although the Pricing management module respects sales agreement rules, the sales agreement feature isn't otherwise integrated with the Pricing management module.

The following flow chart shows the sales order base price determination rules.

Next steps

• Base price versions
• Sales trade agreement prices