pricing parts technician third period procurement 270302d
TRANSCRIPT
Pricing
Parts Technician
Third Period
Procurement
270302d
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
The dealer should start using the new price list on its effective date.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Table 1 - Location code symbols.
Master Price and Part Number Reference
Part Number Suggested Retail Price
Suggested Trade Price
Dealer Price
D D7SZ 1xxx2 A H 1.60 1.28 0.82 D D8BZ 1xxx2 A H 1.45 1.16 0.83 D D8TZ 1xxx2 A H 1.45 1.16 0.83
S D9ZZ 1xxx2 A H 1.50 1.20 0.86 A E0VY 1xxx2 A 2.50 2.00 1.43 B E0VY 1xxx2 B 3.40 2.72 1.94 V C9LY 1xxxx3 B H 62.75 50.20 35.77
D0MY 1xxxx3 A H 12.20 9.76 6.95 D2LY 1xxxx3 A H 13.70 10.96 7.81 D3LY 1xxxx3 A H 13.70 10.96 7.81 CC6MY 1xxx5 A H 56.30 45.04 32.09
NOTE: A - Not stocked in Canada S - Stocked at selected depots B - Stocked in Bramalea Depot only V - Not stocked in Canadian depots D - Stocked in all depots Supplied direct from vendor or via
Bramalea Depot
© 2012, Her Majesty the Queen in right of the Province of Alberta
Table 2 - This price list setup uses "List, User and Dealer" price breakdowns.
No. List Trade Dealer No. List Trade Dealer
5xx8 3.08 2.62 2.05 5xx2 20.94 17.80 13.94 5xx9 6.55 5.57 4.36 5xx3 22.40 19.04 14.92 5xx3B 13.48 11.46 8.98 5xx4 13.69 11.63 9.12 5xx5C 14.81 12.59 9.87 5xx7A 14.02 11.92 9.34 5xx6C 13.60 11.56 9.06 5xx8C 17.66 15.01 11.78 5xx7D 17.99 15.29 11.98 5xx9B 32.96 28.01 21.95 5xx8D 16.32 13.87 10.87 5xx0A 13.80 11.73 9.19 5xx0C 12.67 10.77 8.45 5xx1A 13.28 11.29 8.85 5xx1B 16.57 14.08 11.03 5xx2B 28.81 24.50 19.19 5xx2B 16.55 14.06 11.02 5xx3B 16.41 13.95 10.93 5xx4 18.73 15.92 12.47 5xx4 12.36 10.51 8.23 5xx8A 13.66 11.62 9.10 5xx6A 15.93 13.54 10.62 5xx0C 15.11 12.84 10.06 5xx7 10.94 9.30 7.29 5xx1E 20.19 17.16 13.45 5xx8 2.70 2.30 1.80
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
Insurance companies will not allow you to charge them any other price than the published MSRP.
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
Remember that the marketplace sets the pricing level and always keep in mind whether customers will be willing to pay what you are asking.
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
Cost prices are considered to be confidential company information and should never be revealed to your customer.
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
Manufacturer's retail and trade prices are only suggested prices.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 1 - Vending machine. (Photographed at Fastenal Canada)
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 2 - Currency exchange.
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Figure 3 - Border crossing.
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NOTE
Check Canada Post for current processing fee pricing for packages entering Canada.
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
When calculating your landed cost you do not include the GST. GST is added to the selling price, thus recouping any GST you where charged.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 4 - Freight delivery. (Photographed at The Calgary Airport Authority)
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CAUTION
Discounts are the single largest drain on profit. The customer's account must be analyzed to determine the amount of profit actually being made.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Table 3 - Pricing matrix.
Pricing Matrix
Enter Cost Here
*Markup on Cost
*Markup on Selling Price
Retail Price
0.00 - 0.99 $0.89 150% 60% $2.23
1.00 - 1.99 $1.69 145% 59% $4.14
2.00 - 2.99 $2.25 140% 58% $5.40
3.00 - 4.99 $4.75 130% 57% $10.93
5.00 - 9.99 $8.20 120% 55% $18.04
10.00 - 14.99 $13.99 110% 52% $29.38
15.00 - 19.99 $17.85 100% 50% $35.70
20.00 - 39.99 $34.25 90% 47% $65.08
40.00 - 99.99 $69.75 80% 44% $125.55
100.00 - 499.99 357.98 70% 41% $608.57
500.00 - 749.00 $669.12 60% 38% $1,070.59
750.00 - 999.99 $912.49 50% 33% $1,368.74
1000.00 + $2,264.85 40% 29% $3,170.79
* Due to the markups being rounded to a whole number, calculations may result in a slightly different retail price.
© 2012, Her Majesty the Queen in right of the Province of Alberta
NOTE
Use a markup on cost when adding GST to an invoice.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 5 - Cost markup used to calculate landed cost.
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Figure 6 - Chain or consecutive markup on cost.
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Table 4 - Markups.
Question 1 Question 2 Question 3 Question 4
Landed cost $895.49 $62.15 $9.69 $249.00
Cost price $615.00 $49.95 $5.25 $175.00
$ Markup a) a) a) a)
% Markup b) b) b) b)
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 7 - Retail parts counter.
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Table 5 - Markup on selling price.
$1,000,000.00 (Landed Cost)
Markup on Selling Price
Selling Price Gross Profit Difference Accumulated
20% $ 1,250,000.00 $ 250,000.00
21% $ 1,265,823.00 $ 265,823.00 $ 15,823.00
22% $ 1,282,051.00 $ 282,051.00 $ 16,228.00 $ 32,051.00
23% $ 1,298,701.00 $ 298,701.00 $ 16,650.00 $ 48,701.00
24% $ 1,315,789.00 $ 315,789.00 $ 17,088.00 $ 65,789.00
25% $ 1,333,333.00 $ 333,333.00 $ 17,544.00 $ 83,333.00
26% $ 1,351,351.00 $ 351,351.00 $ 18,018.00 $ 101,351.00
27% $ 1,369,863.00 $ 369,863.00 $ 18,512.00 $ 119,863.00
28% $ 1,388,889.00 $ 388,889.00 $ 19,026.00 $ 138,889.00
29% $ 1,408,451.00 $ 408,451.00 $ 19,562.00 $ 158,451.00
30% $ 1,428,571.00 $ 428,571.00 $ 20,121.00 $ 178,571.00
31% $ 1,449,275.00 $ 449,275.00 $ 20,704.00 $ 199,275.00
32% $ 1,470,588.00 $ 470,588.00 $ 21,313.00 $ 220,588.00
33% $ 1,492,537.00 $ 492,537.00 $ 21,949.00 $ 242,537.00
34% $ 1,515,152.00 $ 515,152.00 $ 22,614.00 $ 265,152.00
35% $ 1,538,462.00 $ 538,462.00 $ 23,310.00 $ 288,462.00
36% $ 1,562,500.00 $ 562,500.00 $ 24,038.00 $ 312,500.00
37% $ 1,587,302.00 $ 587,302.00 $ 24,802.00 $ 337,302.00
38% $ 1,612,903.00 $ 612,903.00 $ 25,602.00 $ 362,903.00
39% $ 1,639,344.00 $ 639,344.00 $ 26,441.00 $ 389,344.00
40% $ 1,666,667.00 $ 666,667.00 $ 27,322.00 $ 416,667.00
The difference in profit between 20% and 30% is $178,571.00. The difference in profit between 20% and 24% is $65,789.00.
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 8 - Discounted invoice.
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NOTE
You calculate the discounts in steps, one after the other. You do not add all the discount percentages together.
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Figure 9 - Invoice showing consecutive discounts.
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Figure 10 - Chain or consecutive discounts.
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Table 6 - Sales and pieces handled.
Discount Sales Gross Profit
Margin Items Handled Profit
0% $1,000,000.00 30% 100 000 $300,000.00
5% $1,140,000.00 26.3% 120 000 $300,000.00
10% $1,350,000.00 22.2% 150 000 $300,000.00
15% $1,700,000.00 17.6% 200 000 $300,000.00
20% $2,400,000.00 12.5% 300 000 $300,000.00
© 2012, Her Majesty the Queen in right of the Province of Alberta
Figure 11 - Negotiations.
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Table 7 - Gross profit margin on $1,500,000 in sales.
$1,500,000.00 (Sales)
Gross Profit Margin
Gross Profit Difference Accumulated
20% $ 300,000.00
21% $ 315,000.00 $ 15,000.00
22% $ 330,000.00 $ 15,000.00 $ 30,000.00
23% $ 345,000.00 $ 15,000.00 $ 45,000.00
24% $ 360,000.00 $ 15,000.00 $ 60,000.00
25% $ 375,000.00 $ 15,000.00 $ 75,000.00
26% $ 390,000.00 $ 15,000.00 $ 90,000.00
27% $ 405,000.00 $ 15,000.00 $ 105,000.00
28% $ 420,000.00 $ 15,000.00 $ 120,000.00
29% $ 435,000.00 $ 15,000.00 $ 135,000.00
30% $ 450,000.00 $ 15,000.00 $ 150,000.00
31% $ 465,000.00 $ 15,000.00 $ 165,000.00
32% $ 480,000.00 $ 15,000.00 $ 180,000.00
33% $ 495,000.00 $ 15,000.00 $ 195,000.00
34% $ 510,000.00 $ 15,000.00 $ 210,000.00
35% $ 525,000.00 $ 15,000.00 $ 225,000.00
36% $ 540,000.00 $ 15,000.00 $ 240,000.00
37% $ 555,000.00 $ 15,000.00 $ 255,000.00
38% $ 570,000.00 $ 15,000.00 $ 270,000.00
39% $ 585,000.00 $ 15,000.00 $ 285,000.00
40% $ 600,000.00 $ 15,000.00 $ 300,000.00
The difference in profit between 20% and 30% is $150,000.00. The difference in profit between 20% and 24% is $60,000.00. In this example for every 1% increase in profit margin equals $15,000.00 increase in gross profit.