How Is Profit Calculated?

How Is Profit Calculated?


You can configure sales incentive plans to measure performance based on revenue, profit, or scoring.

We calculate profit from imported transactions using the following rules. In some cases, we may ask you to provide entries within the product catalog so that we can calculate profit. When necessary, we will generate system alerts to notify you.
  • We first check the following:
    • Is there a transaction field of type "Transaction Profit"?
    • If so, we then use this [Transaction Profit] field

  • Otherwise, we check the following:
    • Is there a transaction field of type "Quantity"?
    • Is there transaction field of type "Price / Unit" with sub-type "Profit / Unit"
    • If so, we then calculate [Order Quantity] x [Profit / Unit]

  • Otherwise, we check the following:
    • Can we calculate Revenue for the transaction (see details)?
    • Is there a transaction field of type "Quantity"?
    • Is there transaction field of type "Price / Unit" with sub-type "Cost / Unit"?
    • If so, we then calculate [Revenue] - [Order Quantity] x [Cost / Unit]

  • Otherwise, we check the following:
    • Can we calculate Revenue for the transaction (see details)?
    • Is there a transaction field of type "Product or Service"?
    • Is there a transaction field of type "Quantity"?
    • We then lookup the product catalog for an entry providing "Revenue / Unit" information
    • If so, we then calculate [Revenue] - [Order Quantity] x [Revenue / Unit]

  • Otherwise, we check the following:
    • Can we calculate Revenue for the transaction (see details)?
    • Is there a transaction field of type "Product or Service"?
    • We then lookup the product catalog for an entry providing "% Profit" information
      • If not, we generate a system alert to request a catalog entry 
    • If so, we then calculate [Revenue] x [% Profit]

  • Otherwise, we can setup a formula which can:
    • Calculate profit based on some logic
    • Lookup another data source

Note: values found in transactions are always converted to the workspace's default currency for the purpose of profit calculations. To do this, we use: 
  • Field mappings you provided when importing transactions (ex: you indicated that a field contains currency information)
  • Exchange rates you provide (or exchange rates we lookup automatically)

Once profit is calculated, it can be converted back to the payee's currency.

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