Service contract installments - example pricing

Installation group A:

  • Sales Value: 100,000
  • Service: Eight percent of the sales value
  • Payment: 12 times annually

Installation group B - 4 x Inspections:

  • Sales amount: 4 x 1000 = 4000
  • Costs amount: 4 x 800 = 3200
  • Payment four times annually
Example

Sales Price Contract (for Installation group A and B):

  • A: 8,000 annually = 667 monthly
  • B: 4,000 annually = 1,000 quarterly

Invoice scheme:

  • January: 667 + 1,000 = 1,667
  • February: 667
  • March: 666
  • Etc.
Example

Costs Price Contract (for Installation group A and B):

  • A: No costs can be entered
  • B: 3,200 annually = 800 quarterly

Gross Margin (GM) can only based on the following pricing methods:

  • Budgeted
  • Price Lists

GM in this case is: (4000 - 3200) / 4000 = 20 percent