Calculate line-level customer discounts for tiers defined by amounts

If you want to apply the discounts to the extended cost for a particular supplier, and the tiers are defined by amounts, the line amount is compared to the first break amount. If the amount is less than the first break amount in the series, the discount equals zero, and the system does no further comparison. Otherwise, the system calculates discounts like this:

1. The line amount (that is, the extended cost of the item) is compared to the first break point. If the amount is less than the first break point in the series, the discount equals zero, and the system does no further comparison.
2. The line amount is compared to the next break point. If the amount is greater than or equal to this break point but less than the next break point or greater than the last break point, the system calculates the discount as follows:
   • If the discount is a fixed amount, the fixed amount for this tier is deducted from the line amount.
   • If the discount is a percentage, the percent (specified for this tier) of the line amount is calculated and deducted from the line amount.
   • The system does no further comparison.
3. The system continues to compare; it repeats step 2 until it has calculated all discount or checked the last break point.

Example

Your company buys an item for 95€. If a series for a line-level discount has tiers defined by amounts with the discounts expressed as percentages, the system subtracts the discount amount calculated as a percent (defined for the appropriate tier) of the extended cost of the item, from the extended price. Let us say that the series is specified with the following break points:

• 1000€: 5%
• 2000€: 10%
• 5000€: 20%

For a line with 10 items (the extended cost is 950€), the discount is zero. For a line with 20 items, the discount is 190€. And for a line with a total of 60 items (the extended cost is 5700€), the discount is 1140€.

If you, for a specific supplier, want to apply the discounts to item costs, check that the break points defined as amounts can be compared to costs (not to extended costs).

The system compares the cost of the line item to the first break point. If the amount is less than the first break point in the series, the discount is zero, and the system does no further comparison. Otherwise, the system calculates discounts like this:

1. The line item's cost is compared to the first break point. If the item cost is less than the first break point in the series, the discount equals zero, and the system does no further comparison.
2. The item cost is compared to the next break point. If the cost is greater than or equal to this break point but less than the next break point or greater than the last break point, the system calculates the discount as follows:
   • If the discount is a fixed amount, the fixed amount for this tier is deducted from the item cost, and the system recalculates the extended cost.
   • If the discount is a percentage, the system calculates and deducts the percent (specified for this tier) of the item cost from the item cost.
   • The system does no further comparison.
3. The system continues to compare; it repeats step 2 until it finds a discount or has checked the last break point.

If, for a specific supplier, the discounts should be applied to item costs and a series is broken down by the quantity of the item, the line quantity of the item is compared to the quantities selected as break points, and the system calculates the discount like this:

• If the discount is defined as a percentage, the specified percent is deducted from the item cost and then the discounted price is multiplied by the line quantity.
• If the discount is defined as a fixed amount, the specified fixed amount is deducted from the item cost and then the discounted price is multiplied by the line quantity.

Example

Your company buys different items that cost 95€, 210€, and 600€. If a series for a line-level discount has tiers defined by the amounts with the discounts expressed as percentages, the discount amount is calculated as the percent (defined for the appropriate tier) of the item price and the system subtracts it from the cost. Suppose that you have specified the series with the following break points:

• 1000€: 5%
• 2000€: 10%
• 5000€: 20%

For a line with 10 units of the item priced at 95€, the discount will be zero. For a line with 20 units of the item priced at 210€, the discount will be 2.10€ per unit with the discount for the line at 42€. And for a line with 600€ item, the discount will be 120€ per unit.