Helping distributors expand their sales efforts
When distributors are in very competitive situations, special pricing agreements (SPA) are often used by manufacturers and primary suppliers to help their distribution channel expand sales efforts. By lowering the price on a specific item or product line, they can help a distributor be more competitive in obtaining the business over its competition.
The key factor is the ability to maintain pricing flexibility in the distribution channel, which offers companies an important competitive advantage. For years, this was primarily accomplished through customer rebates. The problem with rebates is that managing them from an accounting standpoint is often labor-intensive and error-prone. While rebates still exist, SPAs can make the process easier, which is why their use continues to grow significantly.
TrulinX Makes it Easy to Manage Special Pricing Agreements
TrulinX ERP Software makes it easier to accommodate and track special pricing agreements through a program called Price Agreement Maintenance. SPAs can apply to any customer, group of customers or all customers. In general, these prices are good for a defined, limited amount of time and the effective date will cover all items under the agreement for the customer. If there are multiple SPAs from a single vendor for multiple customers, each of the customers will have a unique range of effective dates. Once the price agreement expires, the common practice is to negotiate new prices if the same agreement is still required.
An Automated Process
Once you set up the SPA for a particular customer, TrulinX automatically handles the ongoing process to make your job easier. The setup process typically starts by completing a special price quote within TrulinX with the supplier. Once the SPA is approved by the supplier, the distributor would then set up the SPA in the TrulinX Price Agreement Maintenance screen. From there, the software system does the rest.
Support for Many Types of Special Discounting Methods
If you need more than SPA pricing, TrulinX can accommodate customer contract pricing plus a variety of other types of special discounting methods, including by:
- Customer & Item
- Customer & Sales Product Code (SPC)
- Customer & Pricing Group
- Customer Type & Item
- Customer Type & SPC
- Customer Type & Pricing Group
- Item regardless of anything else
- Pricing Group
- List Price (list price plus)
Learn More About the TrulinX Special Pricing Agreement Feature
The use of Special Pricing Agreements is expected to continue to grow as they provide an opportunity for distributors to win more business. TrulinX makes it easier to be successful with SPAs through robust tracking and management capabilities. Request a demo to learn more.