Choosing Price Margin Rules in CloudCockpit

Price Margin Rules

Determining the pricing strategy is a crucial aspect of business operations and the Price Margin Rules offer different ways to apply prices to Resellers, Customers, or specific Subscriptions.
Here you can find all about the different margin rules available in CloudCockpit and examples of how each of them affect the prices for your clients.


ERP Price: The Microsoft recommended retail price for Customers 
List Price: The subscription base price charged by Microsoft to the CSP
Unit Price: The price for each subscription, depending on the context it's being considered (CSP, Reseller, Customer)


Invoicing Settings

To achieve the intended pricing goal, also configure the additional Invoicing options available in Administration > Settings (Invoicing):

Microsoft Promotions: When enabled, the Microsoft promotions will be applied to your customers.

Markup Limit: When enabled, your applied margins will not go over the ERP price.

Discount Limit: When enabled, your applied margins will not go under your List price.

Margin over ERP for RIs: When enabled, your applied margins will go over the ERP price for Reserved Instances created or renewed after the 1st of January of 2023.


Price Margin Rules


Margin Rule: Markup

The Markup rule takes the List price of an offer and adds a value.

Unit price for reseller = List price + (List price x Price Margin Percentage) 

Example
As a CSP, I can make an agreement with the Reseller where I place a 25% margin over the List 
price of the offer.


Office 365 Business Premium
List price = 8,43€
Margin = 8,43€ x 0,25 = 2,1075€
Unit price for Reseller = 8,43€ + 2,1075€ = 10,5375€ 



Margin Rule: ERP Price Minus Discount

On the ERP Price Minus Discount margin rule the ERP price is used for the calculation.
The percentage set is applied on the ERP price in order to reduce its value.

Unit price = ERP price – (ERP price x Price Margin Percentage)

Example
As a CSP, I can make an agreement with the Reseller where I place a 10% discount on the ERP
price.


Office 365 Business Premium
List price = 8,43€
ERP price = 10,50€
10% Discount = 10,50€ x 0,10 = 1,05€

Unit price for Reseller = 10,50€ - (10,50€ x 0,10) = 9,45€ 



Margin Rule: Split Margin

Split Margin Percentage lets you set a percentage of the difference that you have 
between List price and the ERP price.

Unit price = (ERP price – List price) x Price Margin Percentage + List price

Example
As a CSP, I can make an agreement with the Reseller that I charge 25% of the margin between the Microsoft's List price and ERP price.


Office 365 Business Premium
List price: 8,43€
ERP price: 10,50€

Unit price for Reseller =  (10,50€ - 8,43€) x 0.25 + 8,43€ = 8,9475€ 



Margin Rule: Margin

This price rule increases the unit price above the list price according to the defined percentage.

Unit price = List price / (1 – Price Margin Percentage)

Example


Margin to apply: 10% 
List price = 8,43€

Unit price for Reseller/Customer = 8,43 / (1 – 0,10) = 9,37€



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