Leader/Follower Price Alignment Examples
These are examples of Leader/Follower Pricing:
Leader/Follower Re-Pricing Example Without Price Banding
Leaders and Followers Defined
In this example, the leader is the left-hand mirror and the three followers are right-hand mirrors.
Pricing Policy Rules Used in Example
In this example, following are the relevant pricing policy rules to be used.
Step 1:
When the pricing policy main rule of Current Price + 10% is applied, the prices of all the parts in the pricing policy are raised by 10%.
Step 2:
When the group price alignment rule Leader/Follower Baseline Adjustment = + 5% is applied, the Leader Part Price is calculated to be $9.90 + ($9.90 * 5%) = $10.39.
Step 3:
New Recommended Prices are assigned. The Leader Part Price remains at $10.39, and all followers are assigned the Leader Part Price. So, all parts are priced at $10.39.
Leader/Follower Re-Pricing Example With Price Banding
Leaders and Followers Defined
In this example, the leader is the left-hand mirror and the three followers are right-hand mirrors.
Pricing Policy Rules Used in Example
In this example, following are the relevant pricing policy rules to be used.
Step 1:
When the pricing policy main rule of Current Price + 10% is applied, the prices of all the parts in the pricing policy are raised by 10%.
Step 2:
When the group price alignment rule Leader/Follower Baseline Adjustment = + 5% is applied, the Leader Part Price is calculated to be $9.90 + ($9.90 x 5%) = $10.39.
Step 3:
Price banding is applied.
The pre-price band prices are the prices after the main pricing policy rule is applied.
The price band is +/- 10% of the calculated Leader Part Price of $10.39. This means that the upper limit of the price band is $10.39 + ($10.39 * 10%) = $11.43, and the lower limit is $10.39 - ($10.39 * 10%) = $9.35.
Post-price band prices are calculated as follows:
• Only follower part prices are affected by the price bands defined in the Leader/Follower rule, so the leader part (168B4-101) price remains $10.39.
• The pre-price band price for 979A4-101 = $9.90. This price falls within the price band, so the post-price band price remains $9.90.
• The pre-price band price for 648B4-101 = $11.00. This price falls within the price band, so the post-price band price remains $11.00.
• The pre-price band price for 338B4-101 = $12.10. This price is above the upper limit of the price band, so the post-price band price is set at the upper limit price of $11.43.
Step 4:
The new recommended prices are assigned as the post-price band prices.
Leader/Follower New Pricing Example Without Price Banding
Leaders and Followers Defined
In this example, the leader is the left-hand mirror and the three followers are right-hand mirrors.
Notice that parts 648B4-101 and 338B4-101 are new parts and do not have prices.
Pricing Policy Rules Used in Example
In this example, following are the relevant pricing policy rules to be used.
Step 1:
When the pricing policy main rule of Current Price + 10% is applied, the prices of all the parts in the pricing policy are raised by 10%.
Step 2:
When the group price alignment rule Leader/Follower Baseline Adjustment = + 5% is applied, the Leader Part Price is calculated to be $9.90 + ($9.90 x 5%) = $10.39.
Step 3:
New Recommended Prices are assigned. The Leader Part Price remains at $10.39 and all followers are assigned the Leader Part Price. So, all parts are priced at $10.39.