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Auto calculation of price based on cost of material and labor.

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rohit

Auto calculation of price based on cost of material and labor.

hi,

i was curious if one could automatically calculate product price based on material and labor cost.

To give a better perspective of what i mean, i will brief about our products. We basically sell silverware and gold jewelry items. The price of the product is based on cost Silver and Gold, plus the labor charges to manufacture it which is a percentage of the metal price. Typical pricing method would be Gold price + 30%(just for illustration), this if metal costs are $100, the minimum sale price has to be $130 . Now bullion prices have been very volatile over the past few weeks. From $71 an ounce to $57 approx. This completely changes the pricing and cost structure and a store which has thousands of products, it would be a tiring task to manually update the prices of all products.

Therefore is it possible to define a material like gold, which price per ounce can be updated as frequently as needed. The product will have a feature denoting the metal weight, such that it calculates the cost of gold based on the metal weigth in the product and adds to it the labor price to fianlly arrive at the minimum sales price.

For e.g.

Standard metal rate is $50 per ounce.
Product X has 1/2 ounce of gold.
Thus the minimum product price is $50/2 * 1.30 = $32.5.

I think it is possible to do this in the standard ofbiz download, i.e. without modifying the code, but have not been able to figure out how to do it.

Any suggestions or comments will be appreciated.

Thank you.

rohit

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saanjhi.com

BJ Freeman

Re: Auto calculation of price based on cost of material and labor.

I would use the manufacturing module and create BOM, so you have all the
components of the item.
from there the price can be determined. currently the pricing used lifo,
fifo, averaging. so there many need to be a change in the code for
following gold prices.

Rohit Sureka sent the following on 6/23/06 10:51 PM:

> hi,
>
> i was curious if one could automatically calculate product price based on material and labor cost.
>
> To give a better perspective of what i mean, i will brief about our products. We basically sell silverware and gold jewelry items. The price of the product is based on cost Silver and Gold, plus the labor charges to manufacture it which is a percentage of the metal price. Typical pricing method would be Gold price + 30%(just for illustration), this if metal costs are $100, the minimum sale price has to be $130 . Now bullion prices have been very volatile over the past few weeks. From $71 an ounce to $57 approx. This completely changes the pricing and cost structure and a store which has thousands of products, it would be a tiring task to manually update the prices of all products.
>
> Therefore is it possible to define a material like gold, which price per ounce can be updated as frequently as needed. The product will have a feature denoting the metal weight, such that it calculates the cost of gold based on the metal weigth in the product and adds to it the labor price to fianlly arrive at the minimum sales price.
>
> For e.g.
>
> Standard metal rate is $50 per ounce.
> Product X has 1/2 ounce of gold.
> Thus the minimum product price is $50/2 * 1.30 = $32.5.
>
> I think it is possible to do this in the standard ofbiz download, i.e. without modifying the code, but have not been able to figure out how to do it.
>
> Any suggestions or comments will be appreciated.
>
> Thank you.
>
> rohit
>
> __________________________________________________
> Do You Yahoo!?
> Tired of spam? Yahoo! Mail has the best spam protection around
> http://mail.yahoo.com

Daniel Kunkel

Re: Auto calculation of price based on cost of material and labor.

Hi

One other hack that might work well for this would be to create an excel
xml spreadsheet with the products and a calculation for the price.

When the price changes, you could just re-import the affected products,
and excel would do whatever calculations you wanted. Or you could create
a few dozen xml files for different gold prices, and just import the
appropriate one when the price changes.

I wouldn't normally suggest such a hack normally, but it seems like it
might be appropriate in this situation.

Daniel

On Sat, 2006-06-24 at 03:34 -0700, BJ Freeman wrote:

> I would use the manufacturing module and create BOM, so you have all the
> components of the item.
> from there the price can be determined. currently the pricing used lifo,
> fifo, averaging. so there many need to be a change in the code for
> following gold prices.
>
>
> Rohit Sureka sent the following on 6/23/06 10:51 PM:
> > hi,
> >
> > i was curious if one could automatically calculate product price based on material and labor cost.
> >
> > To give a better perspective of what i mean, i will brief about our products. We basically sell silverware and gold jewelry items. The price of the product is based on cost Silver and Gold, plus the labor charges to manufacture it which is a percentage of the metal price. Typical pricing method would be Gold price + 30%(just for illustration), this if metal costs are $100, the minimum sale price has to be $130 . Now bullion prices have been very volatile over the past few weeks. From $71 an ounce to $57 approx. This completely changes the pricing and cost structure and a store which has thousands of products, it would be a tiring task to manually update the prices of all products.
> >
> > Therefore is it possible to define a material like gold, which price per ounce can be updated as frequently as needed. The product will have a feature denoting the metal weight, such that it calculates the cost of gold based on the metal weigth in the product and adds to it the labor price to fianlly arrive at the minimum sales price.
> >
> > For e.g.
> >
> > Standard metal rate is $50 per ounce.
> > Product X has 1/2 ounce of gold.
> > Thus the minimum product price is $50/2 * 1.30 = $32.5.
> >
> > I think it is possible to do this in the standard ofbiz download, i.e. without modifying the code, but have not been able to figure out how to do it.
> >
> > Any suggestions or comments will be appreciated.
> >
> > Thank you.
> >
> > rohit
> >
> > __________________________________________________
> > Do You Yahoo!?
> > Tired of spam? Yahoo! Mail has the best spam protection around
> > http://mail.yahoo.com

--
Daniel

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Daniel Kunkel [hidden email]
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rohit

Re: Auto calculation of price based on cost of material and labor.

Hi Daniel,

Thanks for the reply. But this doesn't seem to be permanent solution. i was fairly sure that Ofbiz must have some kind of functionality built in support this, since ofbiz is designed for medium to large to businesses.

I am just curios how do business with thounsands of products maitain there prices. Ofbiz is an ERP system and has a manufacturing module, so should it not autmatically determine a cost of the final output based on the cost of the materials used.

Another example for the case may be that of a travel or hotel reservation agency, someone using ofbiz for making hotel reservations may have a similar pricing issue. An agency may have different price discount depending on seasonality and therefore may have to adjust prices of its products. It seems at present he has no option but to manually change the price of all products.

My idea is not for ofbiz to autmatically calculate the final price for all products, but to ensure that the prices fixed are atleast equal to the cost of manufacture of the product. The marketing guy can override this price, but i believe the sytem should show the cost when he edits the price.

rohit

Daniel Kunkel <[hidden email]> wrote: Hi

One other hack that might work well for this would be to create an excel
xml spreadsheet with the products and a calculation for the price.

When the price changes, you could just re-import the affected products,
and excel would do whatever calculations you wanted. Or you could create
a few dozen xml files for different gold prices, and just import the
appropriate one when the price changes.

I wouldn't normally suggest such a hack normally, but it seems like it
might be appropriate in this situation.

Daniel

On Sat, 2006-06-24 at 03:34 -0700, BJ Freeman wrote:

saanjhi.com

BJ Freeman

Re: Auto calculation of price based on cost of material and labor.

there are price rules for end product (one ID) in the catalog module.
maybe you can do that.
but when you have many parts to one Product, visa Many options for one
product, the manufacturing module would be a good place to to this.
there is a feature that lets you build the BOM at the time of purchase,
so you would have current pricing on all the parts, like Gold.

Rohit Sureka sent the following on 6/25/2006 8:29 PM:

> Hi Daniel,
>
> Thanks for the reply. But this doesn't seem to be permanent solution. i was fairly sure that Ofbiz must have some kind of functionality built in support this, since ofbiz is designed for medium to large to businesses.
>
> I am just curios how do business with thounsands of products maitain there prices. Ofbiz is an ERP system and has a manufacturing module, so should it not autmatically determine a cost of the final output based on the cost of the materials used.
>
> Another example for the case may be that of a travel or hotel reservation agency, someone using ofbiz for making hotel reservations may have a similar pricing issue. An agency may have different price discount depending on seasonality and therefore may have to adjust prices of its products. It seems at present he has no option but to manually change the price of all products.
>
> My idea is not for ofbiz to autmatically calculate the final price for all products, but to ensure that the prices fixed are atleast equal to the cost of manufacture of the product. The marketing guy can override this price, but i believe the sytem should show the cost when he edits the price.
>
>
> rohit
>
> Daniel Kunkel <[hidden email]> wrote: Hi
>
> One other hack that might work well for this would be to create an excel
> xml spreadsheet with the products and a calculation for the price.
>
> When the price changes, you could just re-import the affected products,
> and excel would do whatever calculations you wanted. Or you could create
> a few dozen xml files for different gold prices, and just import the
> appropriate one when the price changes.
>
> I wouldn't normally suggest such a hack normally, but it seems like it
> might be appropriate in this situation.
>
> Daniel
>
>
>
>
>
>
> On Sat, 2006-06-24 at 03:34 -0700, BJ Freeman wrote:
>> I would use the manufacturing module and create BOM, so you have all the
>> components of the item.
>> from there the price can be determined. currently the pricing used lifo,
>> fifo, averaging. so there many need to be a change in the code for
>> following gold prices.
>>
>>
>> Rohit Sureka sent the following on 6/23/06 10:51 PM:
>>> hi,
>>>
>>> i was curious if one could automatically calculate product price based on material and labor cost.
>>>
>>> To give a better perspective of what i mean, i will brief about our products. We basically sell silverware and gold jewelry items. The price of the product is based on cost Silver and Gold, plus the labor charges to manufacture it which is a percentage of the metal price. Typical pricing method would be Gold price + 30%(just for illustration), this if metal costs are $100, the minimum sale price has to be $130 . Now bullion prices have been very volatile over the past few weeks. From $71 an ounce to $57 approx. This completely changes the pricing and cost structure and a store which has thousands of products, it would be a tiring task to manually update the prices of all products.
>>>
>>> Therefore is it possible to define a material like gold, which price per ounce can be updated as frequently as needed. The product will have a feature denoting the metal weight, such that it calculates the cost of gold based on the metal weigth in the product and adds to it the labor price to fianlly arrive at the minimum sales price.
>>>
>>> For e.g.
>>>
>>> Standard metal rate is $50 per ounce.
>>> Product X has 1/2 ounce of gold.
>>> Thus the minimum product price is $50/2 * 1.30 = $32.5.
>>>
>>> I think it is possible to do this in the standard ofbiz download, i.e. without modifying the code, but have not been able to figure out how to do it.
>>>
>>> Any suggestions or comments will be appreciated.
>>>
>>> Thank you.
>>>
>>> rohit
>>>
>>> __________________________________________________
>>> Do You Yahoo!?
>>> Tired of spam? Yahoo! Mail has the best spam protection around
>>> http://mail.yahoo.com

Jacopo Cappellato

Re: Auto calculation of price based on cost of material and labor.

In reply to this post by rohit

Rohit,

as suggested by BJ, you should create a bom (bill of materials) for each
of your finished products (ProductAssoc); then you should set the
materials' cost (CostComponent).Then you can automatically get the cost
of the finished product (CostComponent).

For #1: manufacturing-->bill of materials-->create bom
For #2 and #3: catalog-->product-->costs

There is nothing in place to move the cost generated from the
CostComponent entity to the ProductPrice entity: you'll have to write
some custom code there (pretty simple task).

For an example of how costs are setup, have a look at the demo product
"PROD_COST".

Hope this helps,

Jacopo

Rohit Sureka wrote:

cjhowe

Re: Auto calculation of price based on cost of material and labor.

In reply to this post by BJ Freeman

Rohit,

Because your data file source for costs, minimum sales
price, etc is going to be unique to each company (or
at the very least industry) there is no standardized
way to do this. What you'll want to do is create a
service that will update the ProductPrice entity for
the product's minimum price, cost, etc. Then, you can
create Price Rules based on a markup over cost. That
service isn't going to be something that standardized
enough to be in the OFBiz project, I wouldn't think.

I have no real knowledge of what they're doing with
the BOM and manufacturing webapp, so as BJ says, there
may be a solution there as well.

--- BJ Freeman <[hidden email]> wrote:

> there are price rules for end product (one ID) in
> the catalog module.
> maybe you can do that.
> but when you have many parts to one Product, visa
> Many options for one
> product, the manufacturing module would be a good
> place to to this.
> there is a feature that lets you build the BOM at
> the time of purchase,
> so you would have current pricing on all the parts,
> like Gold.
>
>
> Rohit Sureka sent the following on 6/25/2006 8:29
> PM:
> > Hi Daniel,
> >
> > Thanks for the reply. But this doesn't seem to be
> permanent solution. i was fairly sure that Ofbiz
> must have some kind of functionality built in
> support this, since ofbiz is designed for medium to
> large to businesses.
> >
> > I am just curios how do business with thounsands
> of products maitain there prices. Ofbiz is an ERP
> system and has a manufacturing module, so should it
> not autmatically determine a cost of the final
> output based on the cost of the materials used.
> >
> > Another example for the case may be that of a
> travel or hotel reservation agency, someone using
> ofbiz for making hotel reservations may have a
> similar pricing issue. An agency may have different
> price discount depending on seasonality and
> therefore may have to adjust prices of its products.
> It seems at present he has no option but to manually
> change the price of all products.
> >
> > My idea is not for ofbiz to autmatically calculate
> the final price for all products, but to ensure that
> the prices fixed are atleast equal to the cost of
> manufacture of the product. The marketing guy can
> override this price, but i believe the sytem should
> show the cost when he edits the price.
> >
> >
> > rohit
> >
> > Daniel Kunkel <[hidden email]> wrote:
> Hi
> >
> > One other hack that might work well for this would
> be to create an excel
> > xml spreadsheet with the products and a
> calculation for the price.
> >
> > When the price changes, you could just re-import
> the affected products,
> > and excel would do whatever calculations you
> wanted. Or you could create
> > a few dozen xml files for different gold prices,
> and just import the
> > appropriate one when the price changes.
> >
> > I wouldn't normally suggest such a hack normally,
> but it seems like it
> > might be appropriate in this situation.
> >
> > Daniel
> >
> >
> >
> >
> >
> >
> > On Sat, 2006-06-24 at 03:34 -0700, BJ Freeman
> wrote:
> >> I would use the manufacturing module and create
> BOM, so you have all the
> >> components of the item.
> >> from there the price can be determined. currently
> the pricing used lifo,
> >> fifo, averaging. so there many need to be a
> change in the code for
> >> following gold prices.
> >>
> >>
> >> Rohit Sureka sent the following on 6/23/06 10:51
> PM:
> >>> hi,
> >>>
> >>> i was curious if one could automatically
> calculate product price based on material and labor
> cost.
> >>>
> >>> To give a better perspective of what i mean, i
> will brief about our products. We basically sell
> silverware and gold jewelry items. The price of the
> product is based on cost Silver and Gold, plus the
> labor charges to manufacture it which is a
> percentage of the metal price. Typical pricing
> method would be Gold price + 30%(just for
> illustration), this if metal costs are $100, the
> minimum sale price has to be $130 . Now bullion
> prices have been very volatile over the past few
> weeks. From $71 an ounce to $57 approx. This
> completely changes the pricing and cost structure
> and a store which has thousands of products, it
> would be a tiring task to manually update the prices
> of all products.
> >>>
> >>> Therefore is it possible to define a material
> like gold, which price per ounce can be updated as
> frequently as needed. The product will have a
> feature denoting the metal weight, such that it
> calculates the cost of gold based on the metal
> weigth in the product and adds to it the labor price
> to fianlly arrive at the minimum sales price.
> >>>
> >>> For e.g.
> >>>
> >>> Standard metal rate is $50 per ounce.
> >>> Product X has 1/2 ounce of gold.
> >>> Thus the minimum product price is $50/2 * 1.30 =
> $32.5.
> >>>
> >>> I think it is possible to do this in the
> standard ofbiz download, i.e. without modifying the
> code, but have not been able to figure out how to do
> it.
> >>>
> >>> Any suggestions or comments will be appreciated.
> >>>
> >>> Thank you.
> >>>
> >>> rohit
> >>>
> >>>
> __________________________________________________
> >>> Do You Yahoo!?
> >>> Tired of spam? Yahoo! Mail has the best spam
> protection around
> >>> http://mail.yahoo.com
>