Price list change according to raw material cost

[Former Member]

Dear Experts,

We are currently working in a client where for those products for which the raw material is the main component as the cost of the raw materials varies with a high frequency (daily or weekly) the list price (the price we want to invoice to customers) should be updated accordingly and automatically with a specific mark up.

Have you found a similar requirement in any client? If yes, could you explain us from a functional perspective how (SAP standard functionality or custom development with a detailed explanation of the solution) you solved this requirement?

Is there any procedure to do regular massive updates of Finished Good price lists based on the actual variation (and/or expected variation) of raw materials cost?

Thanks in advance for your help.

M.Baig

[former_member183879 · Accepted solution]

Hi Baig,

It is possible to determine the price based on the raw material cost. I dont know whether you are using Moving average price or standard price for the raw material cost.

Whatever be the method, when you create the sales order, it is possible to take the raw material cost on the date of order creation using one of teh cost condition types like VPRS. You can use this condition type as statistical.

You can also have another condition type which is the mark up on this cost.

Now you can calculate your grossprice using another condition type which total up the cost in VPRS condition type adn the mark up %, either through just configuration or by means of a calculation type routine created in VOFM adn then assigning the same for the gross price condition type.

I you have any concerns, pls lemme know.

[Former Member]

I would consider formula pricing. Ravi S's surcharge idea will work if the price is something like:

Base list + x * raw material cost factor.

However, if it's just X * raw material cost factor, the formula idea might work better. I would try to do as much as you can in the pricing procedure - as this gives more traceability to the pricing.

You need to consider how pricing for any returns and adjustments will be made.

[former_member184555]

Hi

Since the cost cannot be changed frequently....one of the alternative is to use a SURCHARGE condition type. You can create the condition record for this surcharge based on the fulctuations in the raw material prices. The surcharge will add up to the regular price.

Thanks,

Ravi

[Former Member]

Dear SNavaneetha Krishnan and Vishal J,

First of all thanks for your replies.

I just need to add a remark, it's the fact that the costing conditions from the material master are determined with the product costing, and the product costing is going to be done only on a monthly basis (it's a SAP recommendation but also a customer requirement in our case).

Problem is that raw material costs are changing very often (usually on a weekly basis) so we would like to know if there's any option to update prices (linked to raw material costs) not having to wait for the monthly product costing.

Many thanks.

[Shiva_Ram]

In my opinion, you need to check with CO expert on this issue. Can you post this in FI/CO forum? I think you can get some response from there.

You may also take a look on OSS Note 721360 - MAP-controlled materials and actual costing for some details.

Regards,

[Former Member]

hi

For youe Item category ,maintain determine cost

maintain VPRS in your pricing procedure

Maintain another Z condition with markup %

For this Z conditition type from to should be the Step no of VPRS

You can maintain the condition record for the Z condition type so that you don't need to give it manually