Understanding Purchase & trade agreements in D365 – Part 5

In Purchase & trade agreements in D365 – Part 1 & 2 blog we have gone through overview of Purchase & trade agreements in D365 & how to setup different types of Purchase agreements in D365. In Part 3 & 4 blog we have covered setup of Trade agreement for purchase price & line discounts.

Let us see difference between Line & multiline discount, if we have same range for line & multiline discount of 5% for 1-101 quantity, 10% for 101-501 quantity & 15% for 501-1001 quantity. When PO has multiple lines of same item. i.e. 1st line has 50pcs & 2nd line has 70pcs. So, in case of Line discount each line will get discount of 5% even though total quantity is greater than 100. But in case of Multiline discount, discount applied will be 10% as total is greater than 100, as it considers total of multiple lines.

& In line & multiline discount, discount is applied to line. But in total discount, it is applied on total purchase order.

In this blog will go through how to setup Trade agreement line discount for Multiline discount & Total discount functionality in trade agreement.

Problem statement –

In this scenario we need to setup trade agreements for Multiline discount & Total discount functionality in trade agreement.

Solution steps –

1 – Will setup trade agreement for Multiline discount

1.1 As discussed in previous blog (Part 3) we have already created Trade agreement journal names; we can use same for this blog.

For those who have not gone through blog part 3 can follow below steps

Create Trade agreement journal names – Go to Procurement & Sourcing -> Setup -> Prices & discounts -> Trade agreement journal names

New -> Name -> Pur Disc -> Description -> Purchase discount -> Relation -> Line disc. (purch.) -> Save.

1.2 & Enable parameters – Go to Procurement & sourcing -> Setup -> Prices & discounts -> Activate price/discount

Enable all parameters for Multiline discount. Item group parameter Yes for Vendor means It is to enable price for specific vendor for specific Item. Item parameter Yes for Vendor group means if price is same for item for group of suppliers (based on vendor group) then need to enable this parameter. Item parameter Yes for All vendors means if item has same prices for all suppliers then need to enable this parameter.

1.3 Create Item group & assign it to items. Go to procurement & Sourcing -> Prices & discounts -> Price/discount group -> Item discount group -> New -> Price groups -> 01 -> Name -> High Margin -> Price/discount group type -> Multiline discount group

New -> Price groups -> 02 -> Name -> Low Margin -> Price/discount group type -> Multiline discount group

1.4 Go to Released products -> respective item -> Purchase Tab -> Multiline discount group -> 01

1.5 Enable Multiline discount – Procurement & Sourcing -> Setup -> Procurement & sourcing parameters -> Prices -> discounts -> Line+Multiline

1.6 Create Trade agreement – Procurement & sourcing – Trade agreement journals -> New -> Name -> Pur disc -> Default relation -> Multiline disc. (purch) -> Lines -> Relation -> Line disc. (Purch.) -> Party code type -> Table -> Account selection -> VEN-000003 -> Product code type -> Group -> Item relation -> 01 -> Unit -> Pcs -> From -> 1 -> To -> 101 -> Unit -> Pcs -> Details (Fast tab) -> Discount percentage 1 -> 5 -> Add line -> From -> 101 -> To -> 501 -> Unit -> Pcs -> Details (Fast tab) -> Discount percentage 1 -> 10 -> Save -> Post

1.7 Create PO – For respective vendor & item. Multiline discount will not reflect automatically.

1.8 To activate discount click on – Purchase (Action pane) – Calculate – Multiline discount. Then discount will be calculated.

2 – Will setup trade agreement for Total discount

2.1 Enable parameters – Go to Procurement & sourcing -> Setup -> Prices & discounts -> Activate price/discount

Enable all parameters for Total discount. Total discount will be applicable for all items.

2.2 Create Trade agreement – Procurement & sourcing – Trade agreement journals -> New -> Name -> Pur disc -> Default relation -> Total disc. (purch) -> Lines -> Relation -> Line disc. (Purch.) -> Party code type -> Table -> Account selection -> VEN-000004 -> Details (Fast tab) -> Discount percentage 1 -> 5 -> Save -> Post

2.3 Create PO for respective vendor. Multiline discount will not reflect automatically.

2.4 To check Total discount go to Purchase order (Action pane) – Totals

2.5 To activate discount click on – Purchase (Action pane) – Calculate – Total discount. Then discount will be calculated.

2.6 Go to Purchase order (Action pane) – Totals, total discount of 5% (as defined in trade agreement) is reflecting in Total discount field.

With this blog we have covered various aspects of Purchase & trade agreements.

We hope you found this article useful, and if you would like to discuss anything, you can reach out to us at transform@cloudfronts.com