CPE Commodity Price Engine SAP Functionality Overview

The Commodity Pricing Engine is used to

• Calculate price components for products, which consist of commodities like metals, ore, oil or other commodities.

• The price calculation is based on complex rules using real stock market and currency data. This should ensure that the price changes of the commodities are reflected in the products prices.

• Carry the complex rules, which are the result of business negotiations, throughout a whole business process (sales or purchasing or even link of both).

Functionality Overview – Coverage

The Commodity Pricing Engine covers complex pricing rules

• Define reference commodity (e.g. Arabic light crude oil or copper from London Metal Exchange)

• Averaging over time periods of quotations (e.g. last month)

• Rules for dynamic period determination

• Rules for currency conversion (e.g. daily or average)

• Rules for quantity conversion

• Surcharge (e.g. your margin on top of the stock price)

• Rules for rounding steps

• High accuracy of intermediate calculation steps (e.g. in oil industry n x 100 million US$ are sold / bought)

• Analysis of intermediate calculation steps

• Evaluation of complex rule (= formula) results in price and value

• Integration into net price calculation (like surcharges, taxes, etc.)

Architecture


Figure - The Commodity Pricing Engine Architecture