Volume pricing describes the scenario where the more that a quantity of a product is increased for a quote, the more the price for each unit of the product decreases. Volume pricing provides an incentive for the buyer to buy more quantities of a product in order to get a lower price. Typically, this scenario is defined by price tiers.
A produce reseller is using volume pricing with bushels of apples, where:
- 1-5 bushels of apples are $20.00 each.
- 6-10 bushels of apples are $17.50 each.
- 11 or more bushels of apples are $15.00 each.
So if a customer is purchasing 10 bushels of apples, the total cost would be $175.00 (10 x $17.50).
To configure volume pricing for a product entry in Mobileforce CPQ, you must specify the following options for the Price Book entry for the product:
- Select Volume as the Method (highlighted in teal below).
- Add two or more pricing tiers for the product:
- In Start Quantity enter the quantity where the tier begins.
- In List Price enter the per unit price for the tier.
The produce reseller specifies the following tiers for apple bushels:
- Tier 1: Start Quantity is 1.00, List Quantity is $20.00
- Tier 2: Start Quantity is 6.00, List Quantity is $17.50
- Tier 3: Start Quantity is 11.00, List Quantity is $15.00
Volume pricing is different from Tiered pricing (which also has price tiers) in that in Volume pricing, the buyer pays the same price per unit for every unit.
Since the minimum quantity sold is 1, Volume pricing should always start with a tier that includes 1. All units above the maximum tier are sold for the price specified in that maximum tier.