concept of pricing
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1. Items/ item categories/ services
2. Qualifiers
a. determine eligibility rules
b. determine who receives the price benefit
3. Modifiers
a. Pricing actions that can be used to adjust the list price
The pricing engine determines the selling price for products and services.
It provides the final selling price after retrieving the initial price from the price list or customer agreement.
If this order qualifies for any increases or decreases from the initial price,
adjustments called modifiers are applied to the price.
-------------------------------------------When the sales order is entered, the pricing engine is called and reads the relevant price list or pricing agreement.
The appropriate modifiers are then applied to the base price and the final selling price is sent to the sales order line or the calling application.
The Adjustments window displays the original price, applied modifiers, and the final price.
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Overview of the Pricing Engine
The pricing engine, which consists of a search engine and a calculation engine, works through open APIs to provide the pricing results to the calling application.
From the pricing request, the pricing engine evaluates the appropriate modifiers and price lists, resolves incompatibility issues, retrieves the list price, and calculates the unit selling
price and adjustments.
The search engine receives pricing information from entities like price lists, modifiers, qualifiers, formulas, products, and pricing attributes.
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Overview of Pricing Security
In Oracle Applications, the basic level of security called functional security is implemented to control users' access to different windows, controls, and reports in the application.
Additionally, Basic Pricing has its own security setup called pricing security that works along with functional security to provide a secure environment where the user can view, update, or
add pricing entities within a framework of authorizations and permissions. Pricing entities are price lists, modifiers, and agreements. You can set up pricing security if you have the
Oracle Pricing Administrator responsibility.
Using pricing security, you can assign pricing entities to operating units, assign privileges, and set security rules for pricing entities.
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Overview of Price Lists
A price list is useful for maintaining the prices and other pricing details of products and services.
-> It serves as a repository of items with their related pricing details.
-> You can retrieve a price list and add/edit/delete related items and item categories.
-> You can also use the price list to define attributes for the products that determine the pricing action.
-> An item should have a price when it is entered on a sales order line.
-> Once the pricing engine populates the unit Price field by deriving the price from the appropriate price list, the order can be booked.
-> The header region of the price list consists of fields to store the price list
name,
the effective dates of the price list,
currency,
multi-currency conversion,
pricing controls,
rounding factor,
and shipping defaults like freight terms and freight carriers.
-> You can enter one or more pricing lines to the price list.
-> However you may add only one secondary price list.
-> Pricing attributes can also be used to determine the price in the price list.
-> You can create as many price lists as needed by entering the information or copying existing price lists.
-> The price lists can be modified to include new items or groups of items.
-> The list price of the price list lines can be increased or decreased by either an amount or a percentage.
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Overview of Formulas
-> You can define prices as constant values or create formulas to provide pricing flexibility and the ability to carry out complex computations.
-> Some of the formulas that are created are based on the following formula component types:
Factor List: You can apply different factor values for varying item attributes
Numeric Constant: Numeric value
Pricing Context: Grouping of pricing attributes, of which a maximum of 100 can be incorporated in the formula
Product Context: Which contains only one attribute, item
-> You can create formulas in the Pricing Formulas window.
-> Basic Pricing provides seeded formulas, such as the Freight and Special Charges Formulas, which includes the Cost to Charge Conversion formula and Cost to Charge Markup formula.
-> These formulas convert freight costs to freight charges.
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Overview of Qualifiers
-> A qualifier defines eligibility rules for modifiers and price lists.
-> A qualifier can be a customer name, a customer class, an order type, or an order amount that can span orders.
-> Though a qualifier may be set up independently, it comes into effect only when linked to a modifier or a price list.
-> Thus, the modifier that is set up and linked to a qualifier determines who the price adjustment will affect as well as the amount that will change.
-> You can create qualifier groups to apply individual qualifiers as a set. When you group qualifiers, they become a set, which allows for faster searching and setup.
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