Price Formulas in Microsoft Dynamics AX – Sales Order Pricing

Closeup image of a male hand giving money to female hand

Pricing, or more specifically sales order pricing, is always a high priority task when implementing a new AX project. Most of the legacy systems I encounter are rigid in that the pricing has to be done a certain way, or the client ends up doing a lot of calculations in Excel and eventually uploading a price list into AX. A lot of those strict rules and pricing manipulation can be alleviated with Advanced Supply Chain’s price formula functionality. The price formulas allow you to create a calculation to mark up or mark down from a defined price basis. Then if a price basis changes on a quarterly, semi-annually, or annual basis, the price formula simply recalculates. There is no need to redo the pricing for the items that changed.

In my scenario, let’s assume I categorize my customers into a Great, Good, and Okay group. The Great customers get the lowest price, the Good customers get a slightly higher price, and the Okay customers the highest price. Within AX, there is a new form we’ll work with called Price formula. My first step is to tell the formula what the foundation of the mark up and/or mark down will be. I’ll set my Price basis to Last purchase price. Next, I’ll add the lines to my formula. For the Great customers, I want to add 10% of the price basis to get my sales price. The Okay customers have a 30% mark up on the price basis. Each formula line will have an Add function and have the Value type be the Percent of basis. I have to enter the correct value for each group. The formula also allows me to enter a simulated price basis to make sure I’ve built my formula correctly. The screen shot below shows the Great and Okay price formula assuming a price basis of $25.

Price Formula 1

Price Formula 2

This example is simple and straightforward, but I could add more lines, if desired. I could add another line to always add a fixed dollar amount to the sales price. I could add a final line and leverage the smart rounding concept in AX, so all my pricing ends in 99 cents. Adding values is the most common function, but I also have the ability to subtract, multiply, or divide.

Moving on to trade agreement creation, I have to select the appropriate price formula on each trade agreement line. The lines of the formula will default into the lower portion of the form in read-only mode. This provides a final QA step to verify the formula is setup correctly.

Price Formula 3

Now onto sales order entry. First, I’ll create a sales order for my Great customer, Oak Company. I’ve added two items, and each of them has a different value for the latest purchase price. To see and verify the trade agreement and price formula, I click the Sales order lineà Price details button. On the Unit price calculation fast tab, I have full visibility to all the formula lines. When I create a sales order for my Okay customer, Orchid Shopping, the system uses the same price basis, but adds a 30% mark up per my price formula.

Price Formula 4

Price Formula 5

Price Formula 6

Price Formula 7

Let’s jump ahead to the future where I need to update my pricing as the cost for some items has changed. This is where I’ve seen clients get lost in sheet after sheet in Excel with formulas to update the sales price based on the new cost. In my example, once the price basis updates, the formulas plug and chug like before. I update the price basis from $50 to $43.21 and create a new sales order for each customer. Can you believe how easy that was!

Price Formula 8

Price Formula 9

This resource has been provided by I.B.I.S. Inc.'s DynamicsCare product experts.

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Kyle Andrich

Article written by

Consultant Kyle has worked with Microsoft Dynamics AX for over 3 years. Prior to working with I.B.I.S., Inc. he worked in the entertainment industry with all of those years related to ticket sales and customer service management. His consulting focus is with trade and logistics. He lives in Atlanta, Georgia and believes college football season is the most wonderful time of the year!

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