Margin maintenance: Adding distributor terms

Distributor terms on a special pricing agreement (SPA) determine the mechanism, pricing, and other details specific to the distributor on the agreement.

This article will guide you through how to add the following distributor terms for a SPA using the margin maintenance support mechanism:

Looking for something else?

• Need help selecting a support mechanism? Click here to learn more about SPA calculations.
• Need help creating a new SPA before adding distributor terms to the agreement? Click here to learn how to create a special pricing agreement.
• Want to make a change to an approved SPA? Click here to learn how to update an existing special pricing agreement.
• Alternatively, see our Help Center for more on SPAs.

Calculates support on transactions using the price list at a given moment in time. Options to select from are:

• Active price list at time of sale: Calculations will use the price list version that was active on the date of the eligible transaction line.
• Active price list at time of approval: Calculations will use the price list version that was active when the SPA was approved.
• Active price list at time of claim: Calculations will use the price list version that was active when transactions were submitted.

Calculates support on transactions using the appropriate price list. This is most often a form of cost list, e.g. a list of amounts that the distributor purchased each product for.

Options to select from are based on the price lists configured in your channel.

This field will display when Distributor delivery is selected in Delivery types in the Details section.

Allows you to set the same distributor delivery value for all products which will be selected in this SPA, i.e. the value when goods are sent to the end-customer from the distributor.

The default value becomes required if all groups/categories or individual products are selected.

If required, the default value can be edited and overwritten for specific individual products or product categories/groups when the Products section is completed. This will be covered in a later section of this guide.

This field will display when Direct is selected in Delivery types in the Details section.

Allows you to set the same direct delivery value for all products which will be selected in this SPA, i.e. the value when goods are sent to the end-customer directly from the manufacturer.

The default value becomes required if all groups/categories or individual products are selected.

If required, the default value can be edited and overwritten for specific individual products or product categories/groups when the Products section is completed. This will be covered in a later section of this guide.

Tip: Both distributor and direct delivery may be used if the invoice goes through the distributor but the manufacturer actually delivers the product - in this case the distributor may receive less support as costs are saved by not delivering the product.

Allows you to add quantities against products on SPAs.

Include quantity is optional, and can be ticked to enable or left unticked if not required.

When include quantity is ticked and the SPA draft is saved, product quantities to be populated will be displayed in the Products section. This will be covered in a later section of this guide.

This field will display when Include quantity is ticked above.

Enforce quantity limits is optional, and can be ticked for quantities to be enforced as limits, or left unticked for quantities to be used more for projection or analytic purposes. If a quantity limit is exceeded, then the support will not appear in the support report.

Enabling Enforce quantity limits and saving will allow you to place quantity limits against specific products within the Products section.

For example: A quantity with a limit enforced of 10 units of Product A means that the 11th transaction of Product A would not be eligible for support under the SPA.

Reduce support by rebate is optional, and can be ticked to calculate a net rebate and support price per product. This option allows program lines to be selected in the Rebate interactions section which will be covered in a later section of this guide. If left unticked, rebate interactions cannot be selected and will not impact support prices.

Tip: Use this if a product has both a volume rebate and SPA support, and the manufacturer wants to ensure that they don’t double pay on the product.

This field will display when Specify end-customer pricing is ticked in the End-customer terms section.

Defines if the distributor support is impacted by the end-customer price on the transaction. Options to select from are:

• Support forfeited: Distributor receives no support if they sell an included product above the supported price.
• Support paid: Distributor receives support as if they sold the included product at its supported price.
• Support calculated on actual sell price: Distributor receives reduced support in proportion to the difference between the sell-out price and the supported price, i.e. support is only calculated on the distributor to end-customer price.

Defines the period within which eligible transactions submitted after a transaction or SPA end date will accrue support. Options to select from are:

• Not set: Select this option if the claim period method is to be chosen later.
• Transaction date: The number of days after the distributor-to-end-customer transaction that a user can submit eligible transactions that will accrue support. E.g. a distributor may be granted a 30-day window to submit transactions following the sale to an end-customer.
• SPA end date: The number of days after the SPA end date that a user can submit eligible transactions that will accrue support. E.g. a distributor may be granted a 30-day window to submit transactions after the SPA end date.

This field will display when a support claim period method is selected.

Type in the number of days after the transaction date or SPA end date (depending on which support claim period method was selected) when transactions will accrue support.

What’s next?

Once you are happy that the Distributor terms section in the Terms tab has been populated, Save draft and navigate to the End-customer terms section.