When dealing with data, and all related terminology, you may feel like you’re trying to speak a foreign language. In the interest of keeping things clear and simple, we will introduce commonly-used terms in each newsletter that will help you navigate the data shorthand and learn the lingo. This week, we explain the multiple types of pricing information that IDEA’s Industry Data Warehouse (IDW) can accommodate.
In the modern fast-moving business environment, your company’s success depends, in large measure, on the cost-effectiveness of your internal processes and the efficiency of your business transactions. Outdated and incomplete pricing information is costly and ineffective because it leads to frequent errors, misquoted bids, wasted time, and inevitably, lost sales. IDEA’s IDW solves the electrical industry’s pricing information problem by offering companies one central platform where accurate, up-to-date pricing data can be uploaded and shared.
The IDW can accommodate multiple types of pricing information, and it is important that the manufacturers and the distributors both understand the purpose of each type of pricing data and the differences between them.
C (cost): The published distributor cost. It is the public price of a manufacturer’s product for the distributor before any price breaks or discounts have been applied.
Net Pricing: The confidential, negotiated price that a distributor will pay for a manufacturer’s product. This price typically varies by distributor, based on a number of factors: sales performance, breadth of line carried by the distributor, and in which region of the country the distributor’s store is located.
L (list): List price is the price at which a manufacturer suggests the distributor sell a manufacturer’s product in stores. It is also referred to as MSRP – manufacturer’s suggested retail price. If the distributor decides to sell at the manufacturer’s list price, then list price minus net price equals the distributor’s gross profit.
T3 (level 3): A trade price, also referred to as “column-3” price, which is typically the price used for a distributor’s best customer. This price may be used in a quantity break or another type of discount with an end user.
If you have any questions regarding pricing information in the IDW, please contact your Data Management Specialist.