Simple Group Price Alignment Examples
These are examples of Simple Group Pricing:
Simple Group Re-Pricing Example Without Price Banding
Simple Group Defined
In this example, the simple group includes Part 2, Part 3, Part 4, Part 5, and Part 7 as denoted in the gray shaded bars. However, out of the parts in the simple group, only Part 3, Part 4, and Part 5 are included in the pricing folder AND the pricing policy. Part 6 is in the pricing policy, but not in the simple group.
Part 2 is not included in the pricing policy, but it is included in the policy folder. Therefore, Part 2 is used to calculate Group Average Price, but its price will not be affected by the simple group rule.
Pricing Policy Rules Used in Example
In this example, following are the relevant pricing policy rules to be used.
Step 1:
The pricing policy main rule of Current Price + 10% is applied. All prices for parts in the pricing policy are raised by 10%.
Step 2:
The first part of the group price alignment rule is applied. The Group Average Price for the simple group is calculated to be $9.10. Notice that only parts in the simple group AND in the pricing folder are included in the average calculation.
Step 3:
When the Baseline Adjustment = +5% rule is applied, the Group Average Price is adjusted to $9.56.
Step 4:
New Recommended Prices are assigned for parts in the pricing policy. Part 3, Part 4, and Part 5 are assigned the Group Average Price of $9.56. Part 6 was not in the simple group, so its price remains at $13.20.
Simple Group Re-Pricing Example With Price Banding
Simple Group Defined
In this example, the simple group includes Part 2, Part 3, Part 4, Part 5, and Part 7 as denoted in the gray shaded bars. However, out of the parts in the simple group, only Part 3, Part 4, and Part 5 are included in the pricing folder AND the pricing policy. Part 6 is in the pricing policy, but not in the simple group.
Pricing Policy Rules Used in Example
In this example, following are the relevant pricing policy rules to be used.
Step 1:
The pricing policy main rule of Current Price + 10% is applied. All prices for parts in the pricing policy are raised by 10%.
Step 2:
The first part of the group price alignment rule is applied. The Group Average Price for the simple group is calculated to be $9.10. Notice that only parts in the simple group AND in the pricing folder are included in the average calculation.
Step 3:
When the Baseline Adjustment = +5% rule is applied, the Group Average Price is adjusted to $9.56.
Step 4:
Price banding is applied to the parts in the pricing policy AND in the simple group.
The pre-price band prices are the prices after the main pricing policy rule is applied.
The price band is +/- 5% of the adjusted Group Average Price of $9.56. This means that the upper limit of the price band is $9.56 + ($9.56 * 10%) = $10.03, and the lower limit is $9.56 - ($9.56 * 10%) = $9.08.
Post-price band prices are calculated as follows:
• The pre-price band price for Part 3 = $9.90. This price falls within the price band, so the post-price band price remains $9.90.
• The pre-price band price for Part 4 = $8.80. This price is below the lower limit of the price band, so the post-price band price is set at the lower limit price of $9.08.
• The pre-price band price for Part 5 = $7.70. This price is below the lower limit of the price band, so the post-price band price is set at the lower limit price of $9.08.
Step 5:
The new recommended prices are assigned as the post-price band prices.
Part 6 was not in the simple group, so its price remains at $13.20.
Simple Group New Pricing Example Without Price Banding
Simple Group Defined
In this example, the simple group includes Part 2, Part 3, Part 4, Part 5, and Part 7 as denoted in the gray shaded bars. However, out of the parts in the simple group, only Part 3, Part 4, and Part 5 are included in the pricing folder AND the pricing policy. Part 6 is in the pricing policy, but not in the simple group.
Notice that Part 4 and Part 5 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:
The pricing policy main rule of Current Price + 10% is applied. All prices for parts in the pricing policy are raised by 10%.
Step 2:
The first part of the group price alignment rule is applied. The Group Average Price for the simple group is calculated to be $9.95. Notice that only parts in the simple group AND in the pricing folder are included in the average calculation. Also, notice that parts with a part price = $0.00 are not included in the average calculation.
Step 3:
When the Baseline Adjustment = +5% rule is applied, the Group Average Price is adjusted to $10.45.
Step 4:
New Recommended Prices are assigned for parts in the pricing policy. Part 3, Part 4, and Part 5 are assigned the Group Average Price of $10.45. Part 6 was not in the simple group, so its price remains at $13.20.