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Siebel Pricing – Component Based Pricing

Siebel Component-based pricing is a pricing method that will allow you to price a customizable product. You need to have a good understanding of customizable product and eConfigurator to understand the possibilities of Siebel Component-based pricing. A customizable product is a product that has one of several component(s). Each of these components can also be a customizable product. In Siebel, you can define a product structure with as many customizable products you need, at any level (well, except at the last level!). Example:

In the above diagram, the product structure has 4 customizable products (in bold). We will also often call customizable product: “CxP” in this series of articles. “Level 1” is often referred as the “root” CxP or simply “root” product. The “why and how” of customizable products will not be discussed in this article. Please note: Readers must know what a CxP is to understand this series of articles. These articles will contain several screenshots of Siebel. Note that We have modified the Applets’ Layout to better show relevant information.

 

Functionalities:

Follows this (high level) workflow: “Component-Based Pricing” is implemented in the “Dynamic Pricing Procedure” (WP) workflow process, at step “Customizable Product Adjustment”. That unique step contains all the logic required for this type of pricing. This workflow is typically used to calculate the Start Price in the Quote/Order. This is important to know because it means that “Component-Based Pricing” is designed to calculate the price of a customizable product based on the different components selected in the product configurator. The price can change based on selected components, but this price will still be seen as the “normal” price, i.e. a price that does not include any discount you may receive (Volume discount, Promotions…) This is why it is shown in the Start Price and not in the Net Price. All forms of discount are calculated in the Net Price by a different WP: “Pricing Procedure – Calculate Net Price”.

 

I have prepared 3 different scenarios to illustrate Component-Based Pricing” There are more variations but those 3 I hope, should cover most situations:

  1. Fixed Pricing : Your CxP has a fixed price, changes in the components will not affect the price.This is a possible solution when you want to bundle products together. Read Fixed Pricing in detail.
  2. Roll-Up Pricing : The CxP has a price of zero, selection of components will define the CxP’s price. This is the approach to consider when you require BOM Pricing. Read Roll-Up Pricing in detail.
  3. Combination of Fixed and Roll-Up Pricing : The CxP has a base price that can change depending of the configuration of the product.This can be used to implement some sort of discount rules ,Components can be purchased separately but at a different price. Read Roll-Up Pricing in detail.

We will discuss all above three variation in next articles of this series.

[EDIT from Matthieu Hattab, 21st of May 2012]: if you have installed 8.1.1.5 there is a bug in the pricing designer. download "Siebel Maintenance Release Guide Version 8.1.1.5, Rev. D" and search for section "Instructions for Bug 10604001"

 

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4 comments on “Siebel Pricing – Component Based Pricing”

  1. Peter Syryn Reply

    Well explained, this clearly show you have been breathing this matter 🙂

  2. Nitin Lehri Reply

    Another angle to Component based pricing can be driven through the attributes. While defining a CxP, we can add attributes to a product e.g. Size of a TV screen, Material of a Cycle wheel etc. Further in the Product Configurator screen, when these components and their attributes are selected then Price will vary. In the sub-PSP WF mentioned above, Attribute based pricing is a vanilla step. The backbone of the Pricing Mechanism is Row Set Transformation Toolkit (RSTT) business service which has several Transformations to support pricing.

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