B-01-08 Overview of Rates

Who: All users
Why: The following provides a definition of Rate Types and an overview of how Rates are used to determine the cost of Items on Orders/Invoices.
Related topics
The Rate is the amount charged for an Item. The Supplier provides the Customer Commercial Contract Manager (CCM) with a Rate Table that is uploaded and attached to the Supplier’s Contract. A Rate Table is required for each of the Supplier’s Contracts with the Customer. As shown in the example below, a rate is specified for each item within each Zone. This is necessary because the rate may vary per Zone (e.g. more expensive in a rural Zone than in a metropolitan Zone).
  • NOTE: The Rate Table illustrated below is only a graphic representation. It does not represent the actual layout and data of the Rate Table.
Each Supplier Contract can be set to either apply the current rate for Items or the rate that applied at the time the Order was accepted by the Supplier. The Rate Type determines how the rate is applied when the Customer is itemising an Order or when the Supplier is actioning the Order or claiming for payment. The following rate types are used in ConSol:
Fixed (F):
The Rate Table illustrated below is only a graphic representation. It does not represent the actual layout and data of the Rate Table.
Example: Item 1 is fixed at $200 (for Zone “ARM”) in the Rate Table. This rate cannot be changed when creating the Order and cannot be changed using a Variation Request.
Capped (C):
The rate for this Item as set in the Rate Table can be changed to a lower value during the creation or processing of an Order. The rate cannot be changed to a value higher than the “cap” set in the Rate Table.
Example: Item 2 is capped at $50 (for Zone “ARM”) in the Rate Table. On the Order the Item can be set to $48.00 (less than capped rate) but not to $52.00 (more than capped rate).
Variable (V):
The rate for this Item as set in the Rate Table is only an estimation of the actual cost. Typically it is used for lump sum items with a quantity of 1 but the exact cost is not known until the Supplier is selected. The rate can be changed as required by the Customer when the Order is created. The Supplier cannot edit the cost of Variable Rate directly. Instead, on a Variation request or Claim for Payment they can set the quantity of the original item to zero and add a new instance of the item for which they can set an alternative rate.
Example: Item 3 in the Rate Table has values for each Zone estimated by the Customer.
At Cost (E):
The rate for this Item as set in the Rate Table is only a guideline. Typically this Rate Type is used for a high turnover Item where the rate changes often. The Customer does not know what the rate will be when the Order is created. The Supplier can change the rate for At Cost items when they accept the Order.
Example: Item 4 has a “placeholder” value of $0 in the Rate Table. After accepting the Order and when the Supplier has determined the actual cost, the Supplier puts through a Variation Request to have the placeholder value of the Item changed on the Order to the actual value.
Percentage (J%):
J% is a Unit of Measure and can be applied against any of the Rate types. The rate for items with a J% UOM is used to calculate the value of the J% item as a percentage of total order costs. For example, if the rate for an item is $10 and total value of other items is $100, then value of J% for that Item is 10 (in other words 10% of the total Order value).

 

NOTE:
  • References to the Rate Types “Agreed” (A) and “Non-invoiced” (N) may be seen in some ConSol screens. Neither of these types is currently in use in ConSol.
  • While some item rates can be modified when submitting a Claim for Payment, once the claim has been accepted and proceeds to the Invoice stage, none of the item rates can be changed.
 
When an Order is raised in ConSol, the Zone, Schedule and Service Category are specified. ConSol limits the list of Suppliers to those who have rates specified for the selected Zone.
Changes to the Rate Table will only apply to new Orders created after the modified Rate Table is uploaded and attached to the Contract. Within the Rate Table you can specify a date for the new rate to take effect (Effective From date). The modified rate will apply to new Orders created after that date. There is also a setting in the Contract that determines whether the rate applied to items is the current rate (default) or the rate that applied at the time the Order was accepted.
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