The Trade Promotions module provides a comprehensive mechanism to manage and control promotions, special offers, rebates, etc., by providing facilities that include:
Complex promotions pricing
Promotions types
Off-invoice
Free Goods
Accruals
Accrual deduction processing
Multi-tiered credit checking
The system maintains the different forms of promotion separately, generates charges off the invoice and tracks accruals and customer deductions. Accounting transactions are generated at each stage.
Promotions can take the form of temporary price reductions taken off the invoice, monies accrued for redemption by the customer, (possibly against future expenditure according to agreements like advertising bill-backs) and special offer goods at no cost (such as "buy one get one free programs") or at minimal cost (such as the "buy one, get the second one at half price" programs). In addition, promotional pricing in the form of single level price reductions can be applied to a company's list price based on the units of measure purchased by a customer.
Trade Promotions pricing enables you to define different prices for selected stock items based on the mass, volume or quantity of the item sold. The establishment of complex pricing structures achieves the goal of invoice accuracy. Price brackets (breaks) are defined using the Price Table program.
Price breaks/brackets can be applied to individual stock items, a list of stock items, or to stock items in a specific product class, product group or department. These prices can then be applied to a specific customer, list of customers, or customers in a specific geographic area, buying group or customer class. This enables the application of bracket pricing on multiple levels. Pricing can be defined as a percentage discount or a new price. In addition, prices can be defined as delivered (you deliver the goods to your customer) or pick-up (the customer collects the goods from you).
Bracket pricing can be applied to a single line item (tiered pricing) or to multiple line items (global pricing) on a sales order.
Item prices are recalculated automatically as sales order line items are added, changed and deleted. Bracket pricing for incoming EDI orders can be applied automatically.
Bracket pricing can be applied either independently or together with promotions.
All promotions can be defined for a single stock item or a group of stock items and can then be applied to different customers, customer classes, buying groups, branches or geographic locations. Promotion qualification thresholds can be based on the quantity, mass or volume of the promotional item sold. You can define a time frame (start and end date) for which a promotion is valid and the start and end dates can be based on either the customer request date or the order date.
The Order Entry system calculates promotional prices automatically using threshold quantities from multiple line items. Multiple promotions can be applied to an individual line item on an order. Qualifying promotions are applied at the time of ending a sales order and can be applied automatically to the sales order or presented to the operator for selection as line items are added or changed.
Details of promotions applied can be reviewed by customer, accrual type, promotion code, deduction code, invoice and date using the Promotion Review program.
Promotions can be applied independently of trade promotions pricing. Accounting transactions relating to promotions are generated automatically.
Off-invoice
Free goods
Accrual
These are discounts or money-off reductions applied to an invoice. The promotion can be a percentage reduction off the item price, a value reduction off the item price, or a new set price that overrides the normal list price.
Off-invoice promotions are calculated at line level and can be configured as:
Line promotion
Line discount
Price change
A reduction value or percentage discount is defined against the stock item(s) and applied as a negative miscellaneous charge line on the sales order, either against the order line (tiered promotion) or the entire order (global promotion).
This is essentially the same as a line promotion, but it can only be applied to individual sales order lines (tiered promotion). The line total value is reduced by the promotion value/percentage reduction, but the calculated promotion value is not displayed on the order.
The unit price of the line item is reduced by the promotion amount or discount percentage. This promotion can only be applied to single order lines (tiered promotion). If both bracket and off-invoice prices are defined, then bracket prices are applied before the off-invoice price promotions are applied.
A free goods promotion can be an item given away for free or an item sold at a reduced price when the customer purchases a specific quantity of the promotional item. The item given away for free or sold at a reduced price does not have to be the promotional item itself (i.e. you can configure 'buy item A and get item B for free', or 'buy item A and get item B at half price' types of promotions).
These are values accrued for later redemption. Accruals can be likened to a loyalty system where, at the time of processing a sales order, the customer accrues values based on the sale of various items over a specific period. Accrual promotions must generally meet criteria (e.g. proof of an advertisement) before being authorized. Accrual values are not shown on sales orders or invoices, but are accrued to the customer in the Trade Promotions system. The accrued values can be reviewed and reimbursed to the customer as either a credit note or a check payment from your Accounts Payable system.
Accrual promotions are applied at the time of processing a sales order. The values are accrued to the customer in the Trade Promotions system. You can use the Promotion Review program to adjust these accrual values up or down.
When your customers pay you, they may claim certain deductions (e.g. if they have run an advertising campaign for you within their stores). Accrued promotions are matched with specific deduction codes that enable you to use the Deduction Review program to track, review and process the deductions that customers make against accruals.
You can accept the deductions and offset them against accrued values, reject them (i.e. reinstate the deduction against the customer by creating a debit note) or write them off. Accounting transactions are generated automatically.
If the customer does not claim an accrual value by deducting it from a payment, you can use the Promotion Review program to reimburse the customer. This can be done by processing a credit note to the customer's account or processing a check for the customer through the Accounts Payable module.
Notes can be entered against deductions and follow-up dates can be defined to assist in the tracking of unresolved deductions.
A credit checking facility exists within the Trade Promotions module (over-and-above the standard credit checking facilities within SYSPRO) which enables you to apply multiple level credit checking.
This is achieved by establishing multiple tiers of SYSPRO and non-SYSPRO customers. You define a master customer account to which you attach various levels of sub-account customers. The sub-account customers do not need to be SYSPRO customers; the master account is merely a holding account and no transactions can be processed to this account. You define credit limits against the master account and/or sub-accounts and the sub-accounts accrue their credit amounts to the next higher level. Credit checking is then applied to the various levels and to the master/sub-account group as a whole.
For example: A customer has branches in various regions. You can create a TPM account as a master account to which you link all the branches. You then set a credit limit for the group against the master account. You can optionally set individual credit limits against each branch. As sales orders are processed for the individual branches (sub-accounts) the credit checking system checks that none of the branches exceeds its individual credit limit (if defined) and that the overall credit limit defined against the master account is not exceeded.
Credit limit checking can also be applied to SYSPRO EDI orders.