Target Price

When purchasing an item, the purchase price of the item can be as low as possible. For this purpose, a buyer can negotiate a target purchase price with supplier for an item when:

  • The item is purchased.
  • A quotation is requested for the item.
  • A purchase contract is finalized for the item.

The target prices are displayed for these purchase objects:

  • RFQ Responses
  • RFQ Response Preparation
  • Purchase Order Lines
  • Purchase Contract Prices
  • Planned Orders (EP)

The Target Price Books are used to calculate and maintain the target prices for the items.

To use the Target Price functionality, you must select the Target Price check box in the Procurement Parameters (tdpur0100m000) session.

You must also set up this master data in the Pricing Parameters (tdpcg0100m000) session:

  • Target Price Book Series: The default series to create the price books for Target Price. You can specify the series linked to the number group specified in the Price Book Number Group field.
  • Target Price Currency: The default currency for the Target Prices. The Target Price is displayed in the currency of the related procurement objects. When calculating the Target Price, Infor LN considers the currency of the procurement objects to this currency. The conversion is based on the currency rates for the day on which the prices are calculated.
  • Actual Target Price Book: The Target Price Book. Infor LN considers this Target Price Book for the Target Price retrieval. This is the Actual Target Price for the Purchase Order Lines, Planned Purchase Orders and the Purchase Contract Prices.
  • Actual RFQ Target Price Book: The Target Price Book for RFQs. Infor LN considers this Target Price Book to retrieve the Target Price on the RFQ Responses and the RFQ Response Preparations. This Target Price Book is updated only if the Update Target Price To field is set to Actual RFQ Target Price Book Book in the Calculate Target Prices (tdpcg0233m100) session.
  • Create Additional Target Price Book Lines in Document Currency: The setting to indicate the procurement objects for which an additional price book line is created in the Target Price Book (tdpcg0613m000) session, if the price for the procurement object is specified in a currency that is different from the currency specified in the Target Price Currency field. The line is created to maintain the transactional currency. When the Target Price is calculated using the Calculate Target Prices (tdpcg0233m100) session, Infor LN creates two price book lines for the selected procurement objects:
    • A Line for with the Target Price converted to the currency specified in the Target Price Currency field. The price conversion is based on the currency rates applicable on the effective date of the procurement object or the price book line.
    • An additional Line with the Target Price expressed in the currency specified for the procurement object.
  • Average Target Price Calculation: The method to calculate the average Target Price for the range of items linked to the purchase order lines. For the average Target Price calculation, Infor LN considers the purchase order lines with these settings:
    • The purchase order lines with the Exclude from Target Price Calculation check box selected, if the Overrule Line Exclusion check box is selected.
    • The purchase order lines with zero Net Price, if the Exclude Zero Prices check box is cleared.
  • Default Search Path for Target Price Calculation: The default search path that Infor LN uses to retrieve the Target Prices, during the Target Price calculation, for the specified range of items.
  • RFQ Response Statuses to Include: The setting to indicate the status of the RFQ Response Lines. Infor LN considers the RFQ Response Lines, with the selected status, during the Target Price calculation. If more than one RFQ Response Line exists for the specified search criteria and the selected status, Infor LN considers the RFQ Response Line with the lowest price, for the Target Price calculation.
  • Contract Line Statuses to Include: The setting to indicate the status of the Contract Lines. Infor LN considers the Contract Lines, with the selected status, during the Target Price calculation. If more than one Contract Line exists for the specified search criteria and the selected status, Infor LN considers the Contract Line with the lowest price, for the Target Price calculation.
Target Price Calculation

You can use the Calculate Target Prices (tdpcg0233m100) session to calculate the target prices for a range of:

  • Items
  • Item Groups
  • Item Types
  • Dates
Note

You can either specify a range of items or a range of item groups.

If you select the Compare Purchase Order Prices to RFQ Prices check box in this session, the purchase order prices and the RFQ prices are compared to return the lowest price.

The net price specified for the procurement objects is considered for target price calculation after the deduction of the discount amount. For the target price calculation:

  • When the net price is retrieved from the price books, Infor LN considers the Break Quantity/Value with the lowest amount, if the Break Quantity/Value is defined in the Price Book Lines (tdpcg0131m000) session.
  • When discount schedule is linked to a transaction, the discount schedule line with the highest discount is considered.

If the Include History check box is selected in the Calculate Target Prices (tdpcg0233m100) session, Infor LN considers only the:

  • Last record added to history for an order line (contract price line/RFQ response line)
  • History record that has not been cancelled.
  • History record for which the related order line (contract/RFQ) does not exist.
Search Path for Price Calculation:

You can specify eight levels of search path in the Calculate Target Prices (tdpcg0233m100) session. When specifying the search path, you must specify a different search value for each level. If you set a level to Not Applicable, the subsequent levels are also set to Not Applicable and you cannot modify the values.

You can specify these values for the search path:

  • RFQ Price (Most Recent)

    Infor LN considers the RFQ Lines for which:

    • A response line has the most recent price in the specified date range.
    • The RFQ Dates in the Requests for Quotation (tdpur1501m000) session are within the specified date range.
  • Purchase Order Price (Lowest)

    Infor LN considers the purchase orders for which:

    • An order line has the lowest net price in the specified date range.
    • The Order Date specified in the Purchase Order Lines (tdpur4101m000) session or the Purchase Order Line History (tdpur4551m000) session, is within the specified date range.

    These purchase order lines are excluded during the price calculation process:

    • The order lines of the type Detail and Back Order.
    • The order lines with these check boxes selected in the Purchase Order Lines (tdpur4101m000) session:
      • Canceled
      • Cancellation in Process
      • Exclude from Target Price Calculation
    • The order lines for which the Payment field is set to No Payment in the Purchase Order Lines (tdpur4101m000) session.
    • The order lines for which the order type has the Consignment Replenishment check box is selected in the Purchase Order Types (tdpur0194m000) session.
    • The order lines for which the order type has the Consignment Payment check box is selected in the Purchase Order Types (tdpur0194m000) session.
  • Purchase Order Price (Most Recent)

    Infor LN considers the purchase orders for which:

    • An order line has the most recent order date in the specified date range.
    • The Order Date specified in the Purchase Order Lines (tdpur4101m000) session or the Purchase Order Line History (tdpur4551m000) session, is within the specified date range.

    These purchase order lines are excluded during the price calculation process:

    • The order lines of the type Detail and Back Order.
    • The order lines with these check boxes selected in the Purchase Order Lines (tdpur4101m000) session:
      • Canceled
      • Cancellation in Process
      • Exclude from Target Price Calculation
    • The order lines for which the Payment field is set to No Payment in the Purchase Order Lines (tdpur4101m000) session.
    • The order lines for which the order type has the Consignment Replenishment check box is selected in the Purchase Order Types (tdpur0194m000) session.
    • The order lines for which the order type has the Consignment Payment check box is selected in the Purchase Order Types (tdpur0194m000) session.
  • Purchase Order Price (Average)

    Infor LN considers the purchase order for which:

    • The average of the prices specified for all order lines is in the specified date range.
    • The Order Date specified in the Purchase Order Lines (tdpur4101m000) session or the Purchase Order Line History (tdpur4551m000) session, is within the specified date range.

    These purchase order lines are excluded during the price calculation process:

    • The order lines of the type Detail and Back Order.
    • The order lines with zero net target price, if the Exclude Zero Prices check box is selected in the Pricing Parameters (tdpcg0100m000) session.
    • The order lines with these check boxes selected in the Purchase Order Lines (tdpur4101m000) session:
      • Canceled
      • Cancellation in Process
      • Exclude from Target Price Calculation Note Infor LN does not consider this check box if the Overrule Line Exclusion check box is selected in the Pricing Parameters (tdpcg0100m000) session.
    • The order lines for which the Payment field is set to No Payment in the Purchase Order Lines (tdpur4101m000) session.
    • The order lines for which the order type has the Consignment Replenishment check box is selected in the Purchase Order Types (tdpur0194m000) session.
    • The order lines for which the order type has the Consignment Payment check box is selected in the Purchase Order Types (tdpur0194m000) session.
  • Purchase Contract Price (Lowest)

    Infor LN considers the purchase contract for which:

    • A contract line has the lowest price in the specified date range.
    • The Effective Date of the Contract Price Line, specified in the Purchase Contract Prices (tdpur3103m000) session, is within the specified date range.

    For the target price calculation:

    • If the Price Book is specified for a contract line in the Purchase Contract Prices (tdpur3103m000) session, Infor LN considers the Price Book with the lowest price break, irrespective of the price book status (Active or Expired).
    • The discounts specified for a contract line in the Purchase Contract Prices (tdpur3103m000) session, are deducted. If more than one discount schedules are linked to the contract line, the discount schedule with the highest discount is considered for target price calculation.
    • Infor LN considers the Contract Line Statuses to Include parameter settings in the Pricing Parameters (tdpcg0100m000) session.
  • Purchase Contract Price (Most Recent)

    Infor LN considers the purchase contract for which:

    • A contract line has the most recently updated price in the specified date range.
    • The Effective Date of the Contract Price Line, specified in the Purchase Contract Prices (tdpur3103m000) session, is within the specified date range.

    For the target price calculation:

    • If the Price Book is specified for a contract line in the Purchase Contract Prices (tdpur3103m000) session, Infor LN considers the Price Book with the lowest price break, irrespective of the price book status (Active or Expired).
    • The discounts specified for a contract line in the Purchase Contract Prices (tdpur3103m000) session, are deducted. If more than one discount schedules are linked to the contract line, the discount schedule with the highest discount (the effective and the expiry dates are not considered) is considered for target price calculation.
    • Infor LN considers the Contract Line Statuses to Include parameter settings in the Pricing Parameters (tdpcg0100m000) session.
  • Specific Price Book Price

    Infor LN considers the specified Price Book. For the target price calculation:

    • If more than one price book line exists for the specified price book, the line with the lowest net price is considered.
    • If more than one discount schedules are linked to the price book, Infor LN considers the discount schedule with the highest discount (the effective and the expiry dates are not considered).
    • Infor LN considers:
      • The price book only if the Type is set to Purchase and the General Use check box is selected in the Price Books (tdpcg0111m000) session.
      • The price book lines only if the Price Type field is set to Buying in the Price Book Lines (tdpcg0131m000) session.
  • Price Book Price

    Infor LN considers the Price Book for which:

    • A price book line has the latest lowest price for the item, when the target price calculation process is executed for the specified date range.
    • The Effective Date specified in the Price Book Lines (tdpcg0131m000) session, is within the specified date range.

    For the target price calculation:

    • If more than one price book lines exist for the item, Infor LN considers the line with the lowest price.
    • If more than one discount schedules are linked to the price book, Infor LN considers the discount schedule with the highest discount (the effective and the expiry dates are not considered).
    • Infor LN considers:
      • The price book only if the Type is set to Purchase and the General Use check box is selected in the Price Books (tdpcg0111m000) session.
      • The price book lines only if the Price Type field is set to Buying in the Price Book Lines (tdpcg0131m000) session.
  • RFQ Price (Lowest)

    Infor LN considers the RFQ Line for which:

    • A response line has the lowest price in the specified date range.
    • The RFQ Date specified in the Requests for Quotation (tdpur1501m000) session, is within the specified date range.

    For the target price calculation:

    • Infor LN considers the RFQ Response Statuses to Include parameter settings in the Pricing Parameters (tdpcg0100m000) session.
    • The response lines with the Exclude from Target Price Calculation check box selected are excluded.
  • Item Purchase Price
    Infor LN considers the lowest Purchase Price specified for the item in the Item - Purchase (tdipu0601m000) session or the Items - Purchase by Site (tdipu0181m000) session.
  • Item Average Purchase Price
    Infor LN considers the lowest Average Purchase Price specified for the item in the Item Actual Purchase Prices (tdipu1500m100) session or the Item Actual Purchase Prices by Site (tdipu1580m000) session.
  • Item Latest Purchase Price
    Infor LN considers the lowest Latest Purchase Price specified for the item in the Item Actual Purchase Prices (tdipu1500m100) session or the Item Actual Purchase Prices by Site (tdipu1580m000) session.
  • Item Simulated Purchase Price
    Infor considers the lowest Simulated Purchase Price for the item from the Simulated Purchase Prices (ticpr1170m000) session. The cost calculation code is also considered.
  • Not Applicable
Impact of Target Price calculation

After the target price calculation process is executed:

  • A new target price book line is created for the item in the Target Price Book Lines (tdpcg0533m000) session.
  • The existing price book line is set to Expired in the Target Price Book Lines (tdpcg0533m000) session, if target price book lines exist for an item and an updated price is available for the item, before creating the new target price book line for that item.
  • The new target prices are calculated and updated in the target price book only if the Simulate check box is cleared in the Calculate Target Prices (tdpcg0233m100) session. If the Simulate check box is selected, a report is generated to display the calculated target prices and these prices are not updated in the related target price book.
  • The new target prices are calculated and updated in the target price book only if the Simulate check box is cleared in the Calculate Target Prices (tdpcg0233m100) session. If the Simulate check box is selected, a report is generated to display the calculated target prices and these prices are not updated in the related target price book.
  • For the specified range of items, when a new target price is not determined, the existing target price book lines are set to Expired, if the Expire Existing Lines when no Target Price found check box is selected in the Calculate Target Prices (tdpcg0233m100) session. This check box must be cleared to retain the existing target price book lines for the specified range of items.
  • The calculated target prices are updated based on the value the Update Target Price To field is set to in the Calculate Target Prices (tdpcg0233m100) session. Possible values:
    • Actual Target Price Book: The target prices are updated in the Actual Target Price Book specified in the Pricing Parameters (tdpcg0100m000) session.
    • Actual RFQ Target Price Book: The target prices are updated in the Actual RFQ Target Price Book specified in the Pricing Parameters (tdpcg0100m000) session.
    • Existing Target Price Book: The target prices are updated to the existing target price book selected from the Target Price Books (tdpcg0113m000) session.
    • New Target Price Book: The target prices are updated to the new target price book that is created based on the series selected from the First Free Numbers (tcmcs0150m000) session. If the RFQ Specific check box is selected, an RFQ specific new target price book is created.
  • The calculated target prices are adjusted based on the percentage or the amount specified in the Adjust Target Price section, in the Calculate Target Prices (tdpcg0233m100) session.
Target Price Retrieval for the Purchase Objects

When an object is created or the item for the object is modified, Infor LN uses this search path to retrieve the target price for the purchase objects:

  1. The target price specified in the Actual Target Price Book or the Actual RFQ Target Price Book existing for the specified item, based on the currency of the object.
  2. The target price based on the Target Price Currency specified in the Pricing Parameters (tdpcg0100m000) session.

If a target price cannot be determined based on this search path, the Target Price field is set to zero and no value is displayed in the Target Price Book and Target Price Book Line fields.

Note

The target prices are always displayed in the currency of the purchase object.

Deleting the Target Price Books

The target price book lines can be deleted using the Delete Target Price Books (tdpcg0213m100) session. You can delete only the lines:

  • For which the Expired check box is selected in the Target Price Book Lines (tdpcg0533m000) session.
  • Related to the target price which are linked to transactions such as a purchase order, purchase contract or an RFQ, which are available in LN.