Managing Customer Agreements—Exercises

Basic Data Setup

Create Customer

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running customer agreement functionality, including deal per sales group.

Windows:
Customer

1. Create a new customer named XX110 and name it McLaren.
2. Save your changes.

General exercise for Customer.

Create Sales Part

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running customer agreement functionality, including deal per sales group and assortments.

Windows:
Sales Part

1. Create four new sales parts: Race Cars XX18-100 Red, XX18-200 White, XX18-300 Blue, and XX18-450 Yellow.
2. Remember the tax codes used if your company is within a VAT tax regime. 
3. Save your changes.

General exercise for Sales Part.

Create Sales Group

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running customer agreement functionality, including deal per sales group.

Windows:
Sales Basic Data/Sales Groups

1. Enter a new Sales Group, XXCA.
2. Save your changes.

General exercise for Enter Sales Groups.

Connect Sales Group

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running customer agreement functionality, including deal per sales group.

Windows:
Sales Part

1. Connect the following parts to Sales Group XXCA:XX18-100 Red, XX18-200 White, and XX18-300 Blue.
2. Save your changes.

Create Assortment

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running customer agreement functionality, including assortments.

Windows:
Assortment

1. Enter a new Assortment, XXAS.
2. Save your changes.
3. In the Structure tab, create sub nodes, XXAS-1, XXAS-2
4. Connect part XX18-200 White to sub node XXAS-1 using Connect Parts and save the record.
5. Connect part XX18-300 Blue to sub node XXAS-2 using Connect Parts and save the record.
6. Save your changes.

General exercise for Enter Assortments.

Main Exercises

Create a Customer Agreement with Deal per Part

Purpose: The purpose of this lesson is to show you how to create a customer agreement where price and discount is defined per part. You will also learn how to set up different prices for different quantity ranges (price breaks).

Windows:
Customer Agreement Sales Part Base Prices
Price Break Template
Price Breaks per Sales Part
Customer Order

Steps: To complete this exercise, perform the following steps in the sequence shown.

Customer XX110 McLaren wants better pricing terms for the cars. The price should be better if you order more than 10 pcs. This can be defined either manually part by part in the customer agreement or via a price break template connected to the sales part base price. A price break template groups parts with the same characteristics when it comes to different prices depending on the ordered quantity.

For Race Car XX18-100, McLaren and IFS Racing Inc. have agreed to the following prices and discounts:

For Race Cars XX18-200 White and XX18-300 Blue, a price break template should be used to get different prices depending on the ordered quantity. The following price break template should be used:

In this exercise, a price and a discount is connected to the sales parts that is registered in the customer agreement.

1. Before entering customer agreement lines, base prices need to be entered for the parts to be used on agreements. Open the Sales Part Base Prices window, right-click and then click Add New Sales Part and enter the base price site (the site for parts to be used on the agreement).
2. In the Sales Part Base Prices window, query for sales part XX18-100 Red and update the base price to 140 USD/140 EUR. Also update the other parts (XX18-200 White and XX18-300 Blue) to have a base price of 140 USD/140 EUR.
3. Open the Price Break Template window and create a new price break template with ID XX, a description and unit of measure corresponding to the price unit of measure for the parts. Save the record.
4. In the table area, enter quantities and the percentage offsets from the base price according to the table above. Save the records.
5. In the header, right-click and then click Activate. The template is now ready for use.
6. In the Sales Part Base Prices window, connect your price break template to the sales parts XX18-200 White and XX18-300 Blue by entering the template ID.
7. If the base price has a status other than the Active status, right-click and then click Activate in the Sales Part Base Prices window.
8. Open the Customer Agreement window. Create a new agreement for Customer XXMcLaren. In the General tab, enable the use of price break templates.
9. Click the Deal per Part tab. Enter Sales Part XX18-100 Red.
10. Enter the first agreement line without any price offset for XX18-100 starting with the Min Sales Qty set to 0. If it is within a VAT tax regime and the Use Price Incl Tax check box is selected in the agreement header, you can enter the price inclusive of tax. Therefore, if the VAT is 25%, the agreed price inclusive of tax is EUR 175.
11. Enter a second agreement line with a price offset of -20 USD/-20 EUR for XX18-100 starting with the Min Sales Qty set to 10. If it is within a VAT tax regime and the Use Price Incl Tax check box is selected in the agreement header, you can enter the price inclusive of tax. Therefore, if the VAT is 25%, the agreed price inclusive of tax is EUR 150.
12. For the two entered agreement lines, right-click and then click Deal per Part Discount and enter a discount type of 10 General Discount and save the record. Add another discount type, S4 Special Discount and save that record as well.
13. Click the Deal per Part tab. Enter Sales Part XX18-200 White and XX18-300 Blue without any offsets on the agreement line. Add discount type 10 General Discount and save the records. Note that the quantities are added automatically from the template.
14. Enter the site where parts are created in the Valid for Sites tab. Note that the same agreement can be used for several sites within the same company.
15. A customer agreement with a deal per part has been entered. However, the agreement must still be activated.
16. Right-click and then click Activate.

Note: A customer agreement has now been created. The next step is to create a customer order for XXMcLaren, with the three parts included in the agreement.

17. Open the Customer Order window. Create an order for McLaren, including 18-100 Red, XX18-200 White and XX18-300 Blue.
18. Verify that the correct price and discount have been given to XX18-100 Red, XX18-200 White and XX18-300 Blue.

Note: When using a price break template on a part, the price breaks are achieved by having different base prices for different quantities on the customer agreement. The sales part base price is adjusted with the percentage offset in the price break template before being distributed to the customer agreement. The Price Breaks per Sales Part window provides an overview of this calculation.

Create a Customer Agreement with Deal per Sales Group

Purpose: The purpose of this lesson is to show how to create a customer agreement with different types of discounts. Note that the agreement created in the previous exercise should be deactivated before starting this exercise.

Windows:
Customer Agreement
Customer Order

In this exercise, several sales parts are registered in the customer agreement. Some of them are included in a sales group, which is entered with a discount in the agreement.

Steps: To complete this exercise, perform the following steps in the sequence shown.

 In this exercise, a price and a discount is connected to the sales part that is registered in the customer agreement.

1. Open the Customer Agreement window. Create a new agreement for Customer XXMcLaren.
2. Click the Deal per Part tab. Enter new prices for all parts using offsets to the base price. Enter Sales Parts XX18-100 (USD 140 or EUR 175 incl. tax), XX18-200 (USD 130 or EUR 162,50 incl. tax), and XX12-300 (USD 120 or EUR 150 incl. tax) all with a Min Sales Qty set to 0. No discount should be entered.
3. Click the Deal per Sales Group tab. Enter Sales Group XXCA with a discount of 10% valid from a Min Sales Qty of 10.
4. Duplicate the first line in the Deal per Sales Group tab and update the Min Sales Qty to 20. Save the record.
5. For this new line, open the Deal per Sales Group Discount dialog box and enter an additional discount line with 4% discount.
6. Enter the site where parts are created in the Valid for Sites tab. Note that the same agreement can be used for several sites within the same company.
7. A customer agreement with a deal per sales group discounts has been entered. However, the agreement must still be activated.
8. Right-click and then click Activate.

Note: A customer agreement has now been created. The next step is to create a customer order for XXMcLaren, with the three parts included in the agreement.

9. Open the Customer Order window. Create an order for McLaren, including XX18-100 Red, XX18-200 Blue, and XX18-300 White. Enter lines with quantities between 0-9 and 10 and upwards to verify that different sales group discounts are used depending on the quantity entered.
10. In the Discount % field and the order line discounts, verify that correct discounts has been given to all sales parts. Also verify that the correct discount source is defined for the different discounts.

Create a Customer Agreement with Deal per Assortment

Purpose: The purpose of this lesson is to show you how to create a customer agreement where the price and discount is defined per assortment. Note that the agreement created in the previous exercise should be deactivated before starting this exercise.

Windows:
Customer Agreement
Customer Order

Steps: To complete this exercise, perform the following steps in the sequence shown.

In this exercise, a price and a discount is connected to the assortment that is registered in the customer agreement.

1. Open the Customer Agreement window. Create a new agreement for Customer XXMcLaren.
2. Enter the assortment for which prices are to be entered in the header of the agreement. Note that the Deal per Sales Group tab is deactivated.
3. Click the Deal per Assortment tab. Enter the first agreement line as follows: assortment node XXAS-1 with a Min Sales Qty set to 0 and a Price UoM (the one valid for the price to be entered) and a price of 110 USD/110 EUR. If it is within a VAT tax regime, you can enter the price inclusive of tax. Therefore, if the VAT is 25%, the agreed price inclusive of tax is EUR 175.
4. Click the Deal per Assortment tab. Enter the second agreement line as follows: assortment node XXAS-1 with a Min Sales Qty set to 10 and the same Price UoM as for the first line and a price of 110 USD/110 EUR. If it is within a VAT tax regime, you can enter the price inclusive of tax. Therefore, if the VAT is 25%, the agreed price inclusive of tax is EUR 175.
5. Optionally, select a line, right-click and then click Deal per Assortment Discount. Enter a discount type of 10 General Discount and save the record. Add another discount type S4 Special Discount and save that record as well.
6. Enter the site where parts are created in the Valid for Sites tab. Note that the same agreement can be used for several sites within the same company.
7. A customer agreement with a deal per assortment has been entered. However, the agreement must still be activated.
8. Right-click and then click Activate.

Note: A customer agreement has now been created. The next step is to create a customer order for XXMcLaren, with the sum of the parts included in the assortment.

9. Open the Customer Order window. Create an order for McLaren, including 18-100 Red.
10. Verify that the correct price and discount have been entered for XX18-100 Red. Also verify that the correct price source is defined on the customer order line.

Work with Price Updates in Customer Agreement

Purpose: The purpose of this lesson is to show you how to work with price updates in customer agreements.

Windows:
Customer Agreement
Update Base Prices
Customer Order

For this exercise you should reuse the agreement created as a part of the exercise for Create a Customer Agreement with Deal per Part. So this agreement should be activated again and any other agreement should be deactivated. The price for purchasing or manufacturing parts has gone up by 25%. Your overhead costs have increased and you have decided to add a percentage offset of 10% before the base price is distributed to the price list. The sales prices on customer agreements should be updated for the coming year to reflect these increased costs. Also, the same parts are sold to a new customer and a new agreement for that customer should be created using an old agreement as base. Print the new agreement.

1. Open the Sales Part Base Prices window and query for the parts to be updated. If the base prices have a status other than the Active status, right-click and then click Activate in the Sales Part Base Prices window.
2. Right-click and then click Update Base Prices.
3. Click the Manual and Costing Pricing option.
4. Click Online in the Execute area.
5. Click the By Percentage option and indicate 25 in the connected field.
6. Click the Replace Offset option and enter 10 in the Percentage Offset field.
7. Enter the parts (or site) for which the update should be applied. Click OK. Note that it is possible to use costing as a base for price updates.
8. After the update of base prices, the agreements affected by this change should also be updated.
9. Right-click and then click Update Customer Agreement from Base Prices and enter the agreement ID for which the update should be performed. Click Manual and Costing Pricing and set the Valid From date to the first of January for the coming year. Click OK.
10. Open the Customer Agreement window.
11. Verify that there has been new agreement lines entered with the new prices and valid for the coming year. Note that in the header of the agreement it is possible to filter agreement lines that are valid at a certain date.

This updated agreement should then serve as a template for another customer.

1. In the Customer Agreement window, right-click and then click Copy Agreement. Enter the new agreement ID and description to be used and also for which customer the agreement should be applied. Optionally you can change the currency, company and valid from date to be used. When copying within the same company, the valid for site entries will also be copied. Click OK.
2. Query for the new agreement and verify that it holds the prices you expected. Optionally you can now update offsets, discounts etc. before activating the agreement.
3. When you are satisfied with the updates you can print the agreement. Check the printout to verify that it displays the prices to be used.

Work with Price Updates in Customer Order

Purpose: The purpose of this lesson is to show you how to work with provisional prices, and how to apply price updates to the customer agreements and customer order lines.

Windows:
Customer Agreement
Customer Order
Customer Order Lines

Customer XX110 McLaren has agreed on a provisional price of 200 USD for the sales part XX18-450, during the first period that it is manufactured and sold. After some time, when the manufacturing and deliveries are running smoothly and the demand is stable, the price should be decreased by 10—15 percent. After six months, a further price reduction of 4—5 percent should be made.

1. Open the Customer Agreement window. Create a new price agreement XX100 for customer McLaren.
2. Click the Deal per Part tab. Enter the sales part XX18-450 with the price 200 USD, and select Provisional Price check box. No discount should be entered.
3. Activate the XX100 agreement.

Note: The customer agreement is now created. The next step is to create a customer order for XX110 McLaren, with the part included in the agreement.

4. Open the Customer Order window. Create an order for McLaren, ordering one XX18-450, Yellow.
5. In the Price Source ID field, verify that the agreement XX100 has been used and that Provisional Price check box has been selected on the order line. 
6. Deliver the order.

Note: You cannot invoice the order line as long as a provisional price is specified. Therefore, before invoicing, the customer is consulted and a price of 195 USD is agreed upon as the invoiced price for the order.

7. Change the price to 195 and clear the Provisional Price check box.
8. Invoice the order.
9. Open the Customer Order window. Create a new order for McLaren, ordering ten XX18-450 parts, Yellow.
10. A further consultation with the customer confirms the price of the order to be decreased to 177 USD with immediate effect  (including all the orders that are not invoiced as yet). The price is no longer provisional. 
    In the customer agreement XX110 for the part XX18-450, change the price to 177 USD and clear the Provisional Price check box.
11. On the deal per part line in the Customer Agreement window, right-click and then click Update Sales Part Prices. Do not enter a date range, and select the check box to update both provisional and none provisional prices.
12. In the Customer Order Lines window, query for all the order lines that have not been invoiced as yet for the part XX18-450. Note that the price is now 177 USD.

Note: There is an alternative method of updating order line prices. The alternative method is used when the customer agrees upon a new price. In this scenario it is 175 USD.

13. In the Customer Order Lines window, query for all the order lines that are not invoiced as yet for the part XX18-450. Right-click and then click Update Sales Part Prices. Enter the new price of 175 USD and update the customer agreement XX110.
14. In the Customer Agreement window, query for XX110. Also note that for the part XX18-450, the price is 175 USD.
15. In the Customer Order Lines window, query for the recently updated order line. Note that the price is 175 USD but the part price from the price source is still 177 USD.

Note: You can query for and analyze the differences between the order line price and the price source price. If there are differences, you can right-click on an order line and then click Recalculate Price/Currency to get order line prices updated from the price source.

Create a Retrospective Invoice Report

Purpose: Learn how the report is created to get an overview of the changing net prices during a period of time when the customer orders are tied to an agreement.
Note: The Retrospective Invoice Report is still based on the net amounts despite of the tax regime used.

Windows:
Customer Agreement
Customer Order

Customer XXMcLaren and IFS Racing have agreed on USD 140 per Race Car XX18-100, if XXMcLaren buys at least 200 cars per year. In the yearly revision of agreements, IFS Racing found that XXMcLaren didn't buy the agreed number of cars. IFS Racing and XXMcLaren therefore agree on a price increase to USD 145 per Race Car. The new price should also apply to cars bought after the first agreement was created. If first exercise has been done, you can skip steps 1 – 3.

1. Enter a price agreement for Customer XXMcLaren.
2. Indicate the general agreement terms such as delivery terms and modes in the General tab.
3. Indicate the XX18-100 Race Car in the Deal per Part tab and define the price as USD 140.
4. XXMcLaren places an order of 10 Racing cars per month, for the next 12 months. Create a customer order and transform it to state Invoiced/Closed.
5. Return to the customer agreement and print the retrospective invoice by right-clicking, then clicking this option on the agreement header. Does it state anything? Why not?
6. Change the price on the Race car from USD 140 to USD 145 and study the displayed data in the Agreement Sales Part Deal History window. Open this window by right-clicking then clicking the choice with the same name in the Deal per Part tab. What is stated?
7. XXMcLaren places a new order of 20 XX18-100 Race cars for the next three months. Create a customer order and transform it to state Invoiced/Closed.
8. Return to the customer agreement and print the retrospective invoice by right-clicking then clicking the option found on the agreement header. How many cars should have an additional cost of USD 5? Why? How much should IFS Racing debit XXMcLaren?