Pricing
With advatra it is possible to define and modify pricing structures for individual products and sets of products with just one click. It is also possible to play with purchase and sales price as well as markups, margins, commissions and VAT rates. This gives you the opportunity to structure your products and prices as individual and detailed as you like and as a result to react on big price changes in a short time.
Pricing definitions
General terms
Purchase price
The purchase price is the price you pay for a service when you buy it from the supplier. The purchase price is invoiced by the supplier.
Markup
The markup refers to a percentage that is added to the purchase price of an item to arrive at a sales price. For example, if you have a markup of 33% on your purchase price, it means that you sold your product 33% above your purchase price. If you want to determine your markup, you can ask yourself the following question: What markup must be added to the purchase price to make a profit?
Margin
Margin refers to the percentage of the selling price that is considered profit. If they have a margin of 33%, it means they made 33% profit on the sale. So margin is the percentage of profit from the selling price. If you want to determine your margin, you can start from the question, how much profit do you want to have in the end?
Selling price
The selling price is the price you invoice to your customer. It consists of the purchase price and the added markup.
Profit
Profit is the difference between the selling price and the purchase price.
Detailed terms
Commission
If you receive a commission, for example from a hotel, advatra can deduct this amount from the purchase price. So if you add a commission, your profit will be higher.
Effective PP (purchase price)
The effective purchase price is the price that your supplier invoiced you at the end.
PP (Purchase price)
The purchase price is the price you pay for a service when you buy it from the supplier. The purchase price is invoiced by the supplier.
Original SP (Selling price)
The original selling price is the price you invoice to your customer. It consists of the purchase price and the added markup.
Total SP (Selling price)
The total selling price consists of the original selling price plus the surcharge/discount.
Original profit
The original profit is the difference between the selling price and the purchase price.
Total profit
The total profit consists of the original profit plus the surcharge/discount.
Original markup
The original markup refers to a percentage that is added to the purchase price of an item to arrive at a selling price. For example, if you have a markup of 33% on your purchase price, it means that you sold your product 33% above your purchase price.
Original margin
The original margin refers to the percentage of the selling price that is considered profit. For example, if you have a margin of 33%, it means they made 33% profit on the sale. So, margin is the percentage of profit from the selling price.
Total margin
The total margin consists of the original margin plus the surcharge/discount.
Total markup
The total markup consists of the original markup plus the surcharge/discount.
Surcharge/discount
The surcharge/discount will be added (or subtracted) on top of the selling price.
Net
The total selling price exclusive value added taxes.
Markup and margin
Markup
The markup refers to a percentage that is added to the purchase price of an item to arrive at a sales price. For example, if you have a markup of 33% on your purchase price, it means that you sold your product 33% above your purchase price. If you want to determine your markup, you can ask yourself the following question: What markup must be added to the purchase price to make a profit?
Margin
Margin refers to the percentage of the selling price that is considered profit. If they have a margin of 33%, it means they made 33% profit on the sale. So margin is the percentage of profit from the selling price. If you want to determine your margin, you can start from the question, how much profit do you want to have in the end?
On which level can markups and margins be set?
- Product category type (Hotel, Transfer, Country)
- Product category (your own categories, which are subordinated to the product category types: for example restaurants, lakes, mountains)
- Supplier (Hotel Schweizerhof AG)
- Product template (Hotel Schweizerhof)
- Subproduct template (Double room with lake view)
What influence does the hierarchy of levels has on prices?
Markups and margins are defined in a specific hierarchy you can see below. If you change the markup or margin on one level (product category), you can update all prices attached to this level and the levels below (supplier, product template, subproduct template) at once. Except the levels in the hierarchy below the one you want to change, have set their own markup and margin. To do this, write the new markup or margin directly in the relevant line and update the line. Attention: Price updates cannot be undone. More on this under Mass Price Updates.
Are there any required steps to be able to set markups and margins?
To be able to set markups and margins, it is important that product categories, product templates, subproduct templates and suppliers are already added and linked to each other during the first setup steps. If these levels have not been added yet, please add them first.
- CRM → Supplier
- Administration → Administration → Sales → Product categoris
- Administration → Administration → Sales → Product templates
- Add product templates (set prices and link suppliers)
- Set markups or margin for product templates or subproduct templates
- Administration → Sales → Price calculation
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- Set markups and margins for product category type, product category and supplier
- Update your prices and get a preview of the updated prices
Where are markups and margins set?
Markups and margins are set in two different places in the system. Levels are split between these two places.
Administration → Sales → Price calculation
- Product category type
- Product category
- Supplier
Administration → Sales → Product templates
- Product templates
- Subproduct templates
Mass price updates
If you don't see the Price calculation menu item, make sure your current user has the Role "Administrator" assigned.
Using set markups and margins, you can perform mass price updates. Price updates can be calculated from either the purchase price or the sales price. Price updates always take into account the lowest level in the markup and margin hierarchy:
- Product category type (Hotel, Transfer, Country)
- Product category (your own categories, which are subordinated to the product category types: for example restaurants, lakes, mountains)
- Supplier (Hotel Schweizerhof AG)
- Product template (Hotel Schweizerhof)
- Subproduct template (Double room with lake view)
What influence does the hierarchy of levels has on prices?
Markups and margins are defined in a specific hierarchy you can see above. If you change the markup or margin on one level (product category), you can update all prices attached to this level and the levels below (supplier, product template, subproduct template) at once. Except, the levels below the level you want to update have their own markups and margins.
For example, if you have set a markup of 20% on a supplier, but a product template with a markup of 15% is attached to this supplier, all prices will be updated with a markup of 20%, except for the first price on the product template. This price will be updated with a markup of 15%.
Update prices
To do this, write the new markup or margin directly in the relevant line and update the line by using the update symbol on the right side of the line.
Only the repetitive prices will be updates. The unique prices are not affected by this change.
Attention
Price updates cannot be undone.
When you update the purchase price, a new purchase price is calculated from the sales price downwards.
If you update the sales price, a new sales price will be calculated from the purchase price upwards.
In the next step, you will see an overview of the new prices. The updated prices are displayed in blue.
Price calculator
If you don't see the price calculator, make sure your current user has the Role "Price calculation user" assigned.
With the price calculator, you can quickly and easily calculate both your markup and margin, defining the optimal purchase and/or sales price.
The price calculator can only be used as soon as a markup or margin has been set on at least one level. In the table below the calculator, you can see the markups and margins already defined.
The selected markup or margin is automatically taken over in the calculator. You can manually adjust the values in the calculator.
Price types
What are the different types of prices?
For a main or additional service, a unique or a repetitive price can be defined. Only one of the two price options can be entered for each service. Repetitive prices repeat annually. Unique prices are limited to a definite time frame.
Repetitive prices
Repetitive prices repeat annually, so you can't assign a year to them. With repetitive prices, you can define different price ranks within a year.
Example
Hotel summer price 01/05 - 30/09 = 200€
Hotel winter price 01/10 - 30/04 = 150€
Since no year is assigned to the price, the hotel has the same summer and winter price every year in the future.
Unique prices
Unique prices are limited to a definitive time frame. Therefore, they are only valid during this period. Several unique prices can be defined for one service, but they must not overlap.
Example
Hotel price 01/05/2023 - 30/09/2023 = 300€
Hotel price 01/10/2023 - 30/04/2024 = 250€
Hotel price 01/05/2024 - 30/09/2024 = 400€
Hotel price 01/10/2024 - 30/04/2025 = 350€
Hotel price 01/05/2025 - 30/09/2025 = 500€
Hotel price 01/10/2025 - 30/04/2026 = 450€
Where can I create prices?
Repetitive and unique prices can be created in the product template under main and additional services.
You can see the created price types under main and additional services.
How can I add price types to a document?
Repetitive prices
Repetitive prices are displayed as before. As before, these already selected prices are also displayed, for which the start and end dates as well as the minimum and maximum number of people match the trip.
Unique prices
A trip from 08/05/2023 - 15/05/2023 will be created.
- During this period, unique prices exist: In this case, the appropriate hotel price is selected based on start and end dates and min. max person.
- If no unique prices exist yet: In this case, the advatra user has to estimate prices to be able to compile an offer. Therefore, he has the possibility to estimate a price based on the old prices via the edit icon in the column selling price.
Commissions
Sometimes when you send guests to a hotel, the hotel will pay you a commission for the booking. This commission can vary depending on the agreement between the two parties.
In order for you to receive this commission, you must send an invoice to the hotel requesting payment.
It is important for you to keep accurate records of their bookings and invoices in order to ensure you receive the correct commission payments from hotels.
In advatra, you can enter commissions at different locations.
Product template
In the main and additional services, you can activate the "Supplier offers commission"-Toggle to activate the commission feature on this price.
You will have to enter the account financial and the VAT of the commission.
Enter the commission as a positive amount. advatra will later subtract the commission from your purchasing price.
Whether it is a Repetitive or a Unique price, you can enter the commission amount for each price as you would enter the purchase and sales price.
Product price
In an Offer or Confirmation, you can change the commission directly on a product for each of the services assigned.
By default, advatra will overtake the commission information directly from the product template.
