What’s the Cost of Expanding My Pricefx Subscription?

If your company already has a Pricefx subscription, great! Somewhere down the line, though, you’ve realized that other processes could be optimized with our software. Or, you’ve expanded operations, requiring additional functionalities to support the increased scope. At this point, all that’s left is a key question: what’s the cost of expanding your Pricefx subscription, and what factors drive that cost?

At Pricefx, we take pride in our transparent approach to costs when getting started with us. In fact, we wrote an article about it. And really, as one of the most cost-effective options on the market for the value, we have no reason to approach the topic differently.

In this article, we’d like to extend this transparency to our customers hoping to add functionalities to their existing subscriptions, providing rough cost estimates and the factors driving those costs up or down, so that you can make an informed decision on how and when to proceed with the process.

So, let’s dive in!

Implementation Costs to Expect When Expanding Pricefx Software

The cost of expanding Pricefx subscriptions takes a few forms – subscription costs, implementation costs, and platform costs:

• Subscription costs involve the Pricefx capabilities your company signs up to use, like Analytics or Price Setting, and your Revenue Under Management (RUM), otherwise known as Annual Revenue Managed (ARM) – the value, in revenue, the software manages for the business.
• Implementation costs are related to the setup of the solution, including adding the relevant workflows, formulas, calculation logic, templates, data, and more.
• Platform costs are connected to the hardware the software runs on, which can either be shared or private.

In general, the cost for expanding a Pricefx subscription, or adding capabilities, depends on these key considerations:

1. What is your company’s Revenue Under Management (ARM) for the solution? The higher the RUM, the higher the cost.
2. Which capability are you buying? Not all capabilities have the same price tag, as they offer distinct benefits.
3. Do you plan to add several capabilities simultaneously? For multiple enhancements, there is usually a significant bundling discount offered of up to 20%.
4. How many geographic territories or number of business units will be affected by the expansion? If Pricefx will need to configure an independent partition for each geography or business unit due to disparate processes, this will likely impact the cost.

If you’re an organization with annual turnover between $500 million and $10 billion, assuming medium complexity, consider these implementation cost estimates (excluding annual SaaS fees):

Price Optimization: $350k – $650k

 

Quoting: $350k –$650k

 

Agreements & Promotions: $350k – $600k

 

Rebates: $350k – $750k

 

Channel Management: $350k – $750k

Note that these ranges are influenced by Revenue Under Management (RUM). For example, a smaller company with low RUM can expect a lower price for adding modules than larger companies with $500,000 RUM or more.

To illustrate a typical medium complexity project, consider this requirement description for a newly added Agreements capability:

I’d like to be able to create a seasonal promotion for my business partners and customers to increase sales. I want to limit the affected countries and product scope, applying the promotion to only a few selected customers. Multiple types of promotions will run in parallel, and we’ll either apply a discount percentage against price lists or set a price value. Prior to applying the promotion, management approval will be needed. The promotion details and price conditions should be exported to our ERP systems, where orders take place.

The requirement above is considered medium complexity with an estimated project length of 4 to 6 months, consisting of 3 to 5 feature sprints. As the example illustrates, medium complexity involves the selection of product scope and customers, multiple types of promotions (in which agreement types need to be configured), value or % logic, and approval workflow and integration.

With that, let’s take a closer look at what the subscription and implementation costs look like for enhancing your existing Pricefx solution with additional use cases.

What Influences Subscription Costs When Expanding Pricefx?

As we’ve mentioned earlier, there are two drivers behind Pricefx subscription costs – capabilities used and Revenue Under Management (RUM).

To find out whether you’ll take on additional subscription costs, ask yourself these two questions: is my solution already using a module to manage the required pricing workflow? And is it expected that the new feature or use case will expand my RUM?

If you already have a capability in your existing subscription to manage the necessary pricing workflow, and the enhancements have no impact on RUM, you shouldn’t expect additional subscription costs. However, if you don’t have a module for new pricing workflows and/or an increased RUM is anticipated, subscription costs will increase for adding the capabilities or reflecting that higher RUM.

What Impacts Implementation Costs When Expanding Pricefx?

When new capabilities are added to your subscription, they’ll need to be configured into the existing solution.

To do that, several factors impact the cost of implementation of additional Pricefx capabilities, including:

1. Complexity of data and pricing workflows
2. Complexity of integration with customer systems
3. Standardization level of the expansion globally
4. Choice of implementation partner

Let’s take a look at what each factor involves.

1.   Complexity of Data and Pricing Workflows

When expanding your existing solution, you’ll need to examine the solution you currently have in place and consider how the enhancement fits into it. Often, the change will require new data and pricing workflows to be accommodated.

If the capability your company plans to add to the subscription is unrelated to those you are currently using, there is a good chance that new data and calculation/pricing logic structures are needed to support the new pricing workflow. In this case, you’ll need to ask yourself how easy it’ll be to gather that new data in your company and deliver it in its cleanest, most structured format, allowing it to be easily loaded and used in Pricefx platform.

Additionally, sudden volume changes in the data you’re bringing in may require larger redesigns that can impact cost.

Beyond that, though, incorporating a new pricing workflow has the largest impact on implementation costs. The costs here are dependent on the complexity of the overall process, including the number of calculations involved, whether external factors influence them, the degree of automated reporting required, and the complexity of approval tiers in workflows.

To avoid a lengthy and costly implementation, aim to standardize your internal processes as much as possible. And, if there’s no getting around it, consider focusing on implementing high-priority areas. Accelerators, our out-of-the-box solutions, are designed to do that quickly. And more recently, our Industry Catalogues, a collection of use cases and features built to address industry-specific challenges, are also a great choice for companies in discrete manufacturing, distribution, and process manufacturing.

2.    Complexity of Integration With Customer Systems

Another cost driver when adding new modules is data integration, both with respect to inbound data (data going into the Pricefx system) and outbound data (data going out of the Pricefx system into your third-party systems).

These costs are determined by the complexity of the data integration and data volume, including the number of new data files to be integrated, the number of new data structures to be created or modified in Pricefx, and the means of integration (whether manual or automated through a file exchange or API).

How you connect your third-party systems with Pricefx also matters, whether through a middleware or directly into the third-party system.

While middleware is typically easier to work with, it necessitates the involvement of your internal IT team to organize the data to fit into your systems. To do that well, a significant level of cooperation between Pricefx and your IT team is required, especially for configuring initial frameworks of data structures to be then used in pricing workflows, and later on for configuring inbound and outbound data integration.

Pricefx offers multiple data connectors and templates that help both sides integrate systems faster with little to no additional configuration, and you can take advantage of lower costs.

3.    Standardization Level of the Expansion Globally

Another cost factor to consider when expanding your subscription is whether enhancements apply to a single country or globally. If multiple countries or business units are involved, will your requirements for the change take the same shape everywhere?

If yes, the cost associated with the configuration will remain stable, as the changes will go towards a common solution. If not, regional discrepancies will be treated as additional changes and costs will be higher. So, as mentioned earlier, a good degree of standardization across markets, where applicable, would be wise to keep costs low.

4.    Choice of Implementation Partner

Pricefx partners with over eighty system integrators (SI) that helps companies of diverse sizes and degrees of global presence get their solution off the ground, and each comes with a different cost.

When selecting a system integrator, note that the person-day rate for those also offering pricing consultancy tends to be higher than that of a local boutique system integrator specialized exclusively in implementing Pricefx.

So, when selecting a System Integrator, choose wisely, and keep in mind this will be a long-term partnership. To help, check references with industry peers and make sure the system integrator has sufficient team size and competence in your area.

Requesting Pricefx Subscription & Project Cost Estimates: What to Expect

Earlier, we offered some cost ranges for you to have in your back pocket before deciding to expand your subscription.

Now, if you’re looking for something more tailored to your company’s requirements, consider reaching out to a Customer Success Manager (CSM), sharing as much detail about your requirements for the expansion as possible.

Some illustrative material might include process and IT landscape diagrams, breakdowns of workflows, screenshots of your current processes, and any other examples to help the Pricefx team to provide a realistic estimate for implementation costs.

During this estimation exercise, you’ll also receive confirmation of which Pricefx capabilities will be configured for you, which will be key information for final subscription costs.

With the project approved and your budget secured, a Pricefx or System Integrator team will then work closely with your company’s subject matter experts to finely comb through your requirements and ask clarifying questions where necessary, leading to a confirmation of the project and a detailed cost breakdown, a proposed timeline and project team structure.

Other Ways to Expand Your Pricefx Solution

Depending on your needs as a business, you may have a few alternatives available to you for expanding your Pricefx solution that don’t involve adding new capabilities:

Self-Sufficiency With Pricefx Training

An ever-increasing number of Pricefx customers are becoming self-sufficient, decreasing their reliance on Pricefx or any third party to support them when managing and enhancing their solutions. Pricefx offers a number of trainings for business and technical users to enhance user understanding of the platform. For more information, an overview of training offerings and costs is available on the Pricefx Training and Certification portal.

Maintenance Contracts

Apart from standard and premium support, Pricefx also offers maintenance contracts. Customer Ongoing Support Agreement, or COSA, covers a certain number of configuration hours per month (from 20 to 48 hours) to help with minor enhancements and provide support for implementing configuration changes (including QA and regression testing) and for rollouts to further regions.

Note that COSA is a Pricefx product; if working with one of our partners, you can ask about an equivalent.

Best Practices for Keeping Pricefx Costs Low

To keep your costs for expanding the pricing solution low, here are a few best practices to follow.

• Use what you already have. Identify and take advantage of opportunities to build from your existing capabilities if this enables you to accomplish the same goals as a new module.
• Aim for sustainability in your solution. Try to avoid any major changes or rework to your currently existing solution if unnecessary, and instead, aim for a robust solution, one which leaves ample room for future data volumes and calculation complexity.
• Have your pricing data ready to avoid project delays or rework. If you opt for adding a new capabilities or features, support their implementation process by proactively preparing your data for integration and avoid hiccups that could incur extra costs.
• Harmonize your pricing processes globally to avoid redundant effort. Disparate pricing processes across markets can lead to treating enhancements as separate projects in each geographic region, which can be incredibly costly. Standardizing processes ensures each enhancement is a single project.
• Quickly deliver added value to end-users with smaller scopes and shorter timelines. Expansions don’t always need to happen in one fell swoop. To quickly see the impact of top-priority improvements, consider implementing them incrementally based on your company’s current needs.
• Collect feedback before undergoing further enhancements. Pricefx and their partners are here to help you weigh the pros and cons, or can connect you with customers with similar needs.
• Take advantage of Accelerators and configuration & integration templates when possible. Rather than start from scratch, use shortcuts to enable expansions to be as cost-effective and quick as possible.
• Select your System Integrator (SI) wisely. Every SI is “built” slightly differently, which will reflect integration costs. To help, consider reaching out to industry counterparts to discover which SI partners have worked for them.
• Consider investing in your own teams by training them as Pricefx experts. Cultivating self-sufficiency is often the better choice when the enhancements needed can be configured in-house.

Not Sure Where to Start? Expand Your Solution Quickly With Accelerators

At this point, we hope you have a more concrete idea of the costs you can expect when deciding to move forward with an expanded Pricefx subscription, and beyond that, have a few tricks up your sleeve to keep those costs low.

Earlier, we called out our out-of-the-box Accelerators as a viable option for companies looking to see value quickly in high-priority areas. If that sounds like that could be you, consider checking out our comprehensive guide to Pricefx Accelerators:

Additionally, if your company operates in the discrete manufacturing, chemical, or distribution industry, consider reaching out to a Pricefx Solution Strategist to walk you through our Industry Catalogue, and discover tailored use cases that address your company’s current gaps and challenges.

Good luck!