Applying the right price for each client and depot
A price depends on the client and the depot serving the order. How to settle which price applies, keep it unchanged through the order, and avoid invented discounts.
The rep quotes a price at the counter. He has it from a sheet he received some time ago, or from what he agreed with this client last time. The order reaches the office, and someone there sees a different figure. Now there is a choice: honour what the rep said and lose margin, or go back to the client and lose some goodwill.
For the director the question is wider. How many prices are in circulation right now, and who decided them? A distributor rarely has one price per product. The price varies with the client and with the depot that serves him, and when those variations live in people’s heads and in old files, nobody can really answer.
Why is the right price so hard to apply?
The rules themselves are usually simple enough for a person to explain. The trouble is applying them, order after order, from memory. A rep has to remember what was negotiated with this client, what applies from this depot and what discount the client has, then get all of it right while the client is talking to him. If one of those changes, the news reaches some reps sooner than others.
The most specific price wins
DeepComm applies one predictable rule: the most specific price wins, and any discount comes on top. For each line of an order, it looks in this order:
- A negotiated price, if one has been agreed with this client for this product.
- The depot’s price, if there is no client price and the depot serving the order has its own price for this product.
- The standard catalogue price, if neither of the above applies.
Then the client’s discount, as a percentage or an amount, applies to the price retained and gives the final price of the line. The discount does not change which price was picked.
Price rules sit in the configuration, in the hands of general management, regional management and sales administration, and the app applies them from there. The rep has nothing to remember. When he adds a product to the cart, the price is worked out for that client and that depot, and the applicable VAT is included in the cart’s total.
The price shown is the price of the order
A price that changes along the way is worth little, so the app does not let it. The price is fixed when the order is created, and the order keeps the price the rep saw. The office, the delivery note and the invoice work from that same figure.
If a client orders by himself in his own space, the rep or sales administration picks up the order, sets the price and the depot, and validates it. If a client later turns out to have received more than ordered, the additional delivery note and invoice go out at the same negotiated price.
Depots can create one legitimate exception. If the depot changes at delivery and the price is different, the difference is handled by a credit note or an additional invoice, as general management or sales administration chooses, and it remains visible.
Some things the price will never do
A finance director may reasonably want to know how the price behaves when data is missing. A selling price never falls back on the purchase cost or the stock value of a product. A product with no selling price stays with no price, and the app does not invent one.
The same care applies to discounts. A discount is shown only when a real struck-through price exists, so a rep cannot be misled by a reduction calculated from nothing.
The margin then gets measured on what happened. It compares what was delivered and invoiced with the real cost of the goods that left the stock, and general management can read it by product and by seller.
