Automated Item Price Change Tracking and Approval in NetSuite

Every business that sells a product or item depends on the buy-sell ratio, right? You’ll usually have a designated person or department handling sales, often offering discounts to boost volume. However, there are times when the product price may change during the selling process—maybe due to promotional periods or adjustments made by the sales team. These shifts can lead to unexpected losses if there’s a large gap between the buy and sell price. Now, imagine having an approval system in place to oversee these price changes.

This case study explores how we developed an approval workflow that enables managers to monitor and control price adjustments, giving them the authority to edit, approve, or reject orders efficiently.

A home appliance superstore based in the USA approached us to implement an efficient order approval system to manage their items for sale.

When dealing with large inventories, products, and services across multiple locations, having an efficient approval system is essential for accurate financial handling and tracking the buy-sell ratio.

Our client, a prominent distributor, faced a challenge in understanding the impact of price changes on the items listed within a sales order before a sale was finalized. The company needed a mechanism to capture and assess fluctuations in base prices to ensure profitability, maintain financial accuracy, and exercise oversight on sales team actions. Specifically, they required a solution that would not only track price changes but also provide a structured approval workflow based on the degree of price adjustment.

To address the client’s requirement, we proposed a solution within NetSuite to automate the tracking and approval process for base price changes on sales orders. Our approach emphasized creating a dynamic workflow that aligned approval requests with the intensity of price change and specific role-based access within the company. This setup allowed for a clear, hierarchical approval structure, ensuring that any significant deviations in item pricing received appropriate managerial review.

• Automated Workflow: We designed a system that automatically detects base price changes at the line-item level within sales orders. This ensures immediate flagging of any adjusted prices, reducing manual oversight.

• Approval-Based Email Notifications: Notifications are triggered based on the percentage of price change:

a) If the price change exceeds a high threshold, an email is sent to the General Sales Manager for immediate review.

b) For moderate changes, a notification is directed to the Sales Manager.

c) Minor adjustments are auto approved if they fall within a pre-set permissible range.

• Location-Based Customization: Each notification is location-specific, enabling managers to quickly assess the impact within their jurisdiction.

• Mandatory Reason Submission: Sales representatives are required to provide a reason when adjusting an item’s price. This creates transparency and accountability in pricing decisions.

By implementing this structured process, we enabled the client to gain insights into their sales team’s pricing adjustments, thereby strengthening control over profit margins.

One of the primary challenges encountered during this was the Workflow Customization setup. Configuring the NetSuite workflow to detect multiple items with varying degrees of price adjustments in a single sales order required intricate customizations.

Following the successful deployment of the new price adjustment and approval workflow, the client witnessed substantial improvements in managing price changes.

• Better Pricing Control:

a) Sales managers now have a clear, structured overview of any price adjustments, allowing them to monitor potential profit loss due to price variations.

b) High-level changes are escalated directly to the General Sales Manager, ensuring that critical adjustments undergo rigorous scrutiny.

• Improved Financial Accuracy:

a) The automated approval process prevents unsanctioned price reductions, which has positively impacted revenue tracking and financial accuracy.

b) By enforcing a mandatory reason for price changes, the client gained better insights into sales strategies and team performance.

• Role-Based Oversight:

Managers at different levels can quickly assess price changes relevant to their roles, thereby improving decision-making efficiency.

Overall, this implementation has empowered the client with better visibility and control over their pricing strategies, which in turn contributes to revenue management and profitability.

With these enhancements, we anticipate that our client will continue to maintain tighter control over pricing adjustments, safeguarding profitability and strengthening their position in the competitive distribution market.