| Main Menu | Setup | Pricing Setup | Default Cost Multipliers |
Screens
Control creates a special type of constant for cost-plus pricing that is defined automatically. These constants can be used as the cost multipliers for each type of part and are used for product pricing when appropriate.
Figure 10 1 Cost Multiplier Screen
| Default Equipment Cost Multiplier (DefaultEquipmentMultiplier) | For equipment parts. Normally multiplied by the material costs to determine their price. | ||
| Default Freight Cost Multiplier (DefaultFreightMultiplier) | For freight parts. Normally multiplied by the material costs to determine their price. | ||
| Default Labor Cost Multiplier (DefaultLaborMultiplier) | For labor parts. Normally multiplied by the material costs to determine their price. | ||
| Default Material Cost Multiplier (DefaultMaterialMultiplier) | For material parts. Normally multiplied by the material costs to determine their price. | ||
| Default Other Cost Multiplier (DefaultOtherMultiplier) | For other parts. Normally multiplied by the material costs to determine their price. | ||
| Default Outsource Cost Multiplier (DefaultOutsourceMultiplier) | For outsourced parts. Normally multiplied by the material costs to determine their price. | ||
| Default Overhead Cost Multiplier (DefaultOverheadMultiplier) | For overhead parts. Normally multiplied by the material costs to determine their price. |
Effective Use
To use these system constants, you must still apply them in the product pricing setup.
Normally, this formula looks something like:
PreDiscountPrice ( DefaultMaterialMultiplier * MaterialCost ) +
( DefaultLaborMultiplier * LaborCost ) +
( DefaultEquipmentMultiplier * EquipmentCost ) +
( DefaultFreightMultiplier * FreightCost ) +
( DefaultOutsourceMultiplier * OutsourceCost ) +
( DefaultOtherMultiplier * OtherCost )
This pricing formula is normally the first formula entered in the pricing formula templates.
It is also common to see derivative pricing that may not include certain aspects of costs.
For instance, if you price using a multiple on materials and labor, you might want to record and track your machine costs but not include them in your price calculation.
In this case, simply omit (DefaultEquipmentMultiplier * EquipmentCost) from the formula. Likewise, certain industries omit labor considerations into their machine rates.
For maintenance purposes, it is easier to have one place to track the various multipliers you use. If you need different multipliers for different types of products, you should create your own User constants for these.
For example, you could create User constants for VinylSignMaterialMultiplier, VinylSignLaborMultiplier, OffsetMaterialMultiplier, OffsetEquipmentMultiplier, and so forth.
This makes the formula more readable and centralizes all of the variables so they can be easily reviewed and adjusted.
See Also