In the platform, the final price of a product can be calculated using two main methods, each having specific advantages depending on the business strategy, product type, and customer relationship. This guide explains the two options in detail: Fixed Sales Price and Variable Price (Cost + Markup).

Fundamental Concepts

• Cost vs. Price:
  • Cost: Represents the total amount of money invested to produce or acquire a good (raw material cost, processing cost, depreciation, etc.).
  • Price: Represents the amount of money the end customer pays to acquire that good.
• Product Types:
  • Raw Material: The basic element that enters production (e.g., wood, metal, paint).
  • Simple Products: Those that do not require processing.
  • Services
  • Super Product / Finished Product: The final result obtained by combining raw material with one or more processing steps.

Additional term: Equipment / Processing: The technological action applied to the raw material (e.g., CNC cutting, welding, painting). Each process has an associated cost.

• Equipment Processing Cost:
  The cost generated by equipment consists of Fixed Cost (depreciation, rent, salaries) and Variable Cost (consumables, electricity). The system calculates a final processing cost (e.g., 3 euros / square meter).
  • Work Profile: Allows adjusting this base cost according to the complexity of the work. For example:
    • Standard Profile (100%): Cost remains 3 euros/sqm.
    • Special Model Profile (300%): Cost becomes 9 euros/sqm.
    • Low Quality Profile (50%): Cost is reduced to 1.5 euros/sqm.

This method is ideal for situations where you want a stable sales price that does not fluctuate with the acquisition cost of raw materials.

Calculation formula:
Final Price = (Fixed Raw Material Sales Price/UM + Fixed Processing Sales Price/UM) x Quantity
(UM = Unit of Measure, e.g., piece, square meter)

Where is it configured?

• For Raw Material: In the product page, in the Fixed Sales Price field.
• For Equipment: In the equipment page, at the corresponding Work Profile, in the Fixed Sales Price field.

Practical example:

• Order: A beech wood countertop, size 1x1 sqm, processed with the "Special Model" profile.

1. Fixed Price Configuration:
   • Raw Material (Beech Wood): Set Fixed Sales Price = 20 euro/sqm.
   • CNC Equipment ("Special Model" Profile): Set Fixed Sales Price = 8 euro/sqm.
2. Calculation for 1 sqm:
   • The system adds the fixed prices per unit of measure: 20 euro/sqm (wood) + 8 euro/sqm (processing) = 28 euro/sqm.
   • Final Price = 28 euro.

Advantage: The price is predictable and easy to communicate to the customer, regardless of internal costs.
Important: Even if the sales price is fixed, the system will calculate the actual costs to provide you with accurate profitability reports.

This method is perfect for ensuring a constant profit margin. The sales price adjusts dynamically based on the acquisition cost of raw materials and the processing cost.

Calculation formula:
Final Price = (Total Raw Material Cost + Total Processing Cost) + Markup %

Where is it configured?

• For Raw Material: The Acquisition Cost is used (e.g., 10 euro/sqm). The markup is defined as a percentage based on the customer category (e.g., Small Business Markup = 200%).
• For Equipment: The final Cost calculated by the system for the Work Profile is used (e.g., 9 euro/sqm for "Special Model").

Practical example:

• Order: A beech wood countertop, size 1x1 sqm, processed with the "Special Model" profile, for a customer in the "Small Business" category.

1. Cost Identification:
   • Raw Material (Beech Wood): Acquisition Cost = 10 euro/sqm.
   • CNC Equipment ("Special Model" Profile): Processing Cost = 9 euro/sqm.
   • Markup: For "Small Business" customers, the markup is set to 200%.
2. Calculation for 1 sqm:
   • Total Cost: 10 euro (wood) + 9 euro (processing) = 19 euro.
   • Markup Calculation: 19 euro x 200% = 38 euro.
   • Final Price: 19 euro (Cost) + 38 euro (Markup) = 57 euro.

Advantage: Protects the profit margin against cost fluctuations and allows for a differentiated pricing strategy by customer categories.

Comparative Summary

Feature	FIXED PRICE Method	VARIABLE PRICE Method (Cost + Markup)
Calculation Basis	Predefined sales prices.	Real costs (acquisition + processing).
Price Stability	Very stable. Does not change if costs change.	Fluctuates with costs.
Margin Stability	Profit margin varies if costs change.	Profit margin (%) is constant.
Ideal for	Situations where you want to align with competitors' prices and these are known.	Products with volatile acquisition costs, pricing strategies across customer segments.
Simplified Formula	Fixed material price + Fixed processing price	(Raw material cost + Processing cost) + Markup %

Choosing the correct price calculation method depends entirely on your business model.

Note: Regardless of the chosen calculation method – whether you use a Fixed Sales Price or a Variable Price based on cost and markup – the final price generated by the system can be edited directly in the quote or order page. The automatically calculated price serves as a correct and fast starting point, but you always have the final control.