---
sourceDocument: Xanadu Sales Customer Relationship Management
sourceDocumentLink: https://servicenow-prod.fluidtopics.net/r/xanadu/order-management

 Release :

    - xanadu

ft:locale :

    - en-US

ft:publication_title :

    - Xanadu Sales Customer Relationship Management

ft:clusterId :

    - omgmt

bundleId :

    - omgmt

workflow :

    - Customer and Industry


---

# Pricing Management

# Pricing Management {#ariaid-title1}

* Release version: Xanadu
* 
* Updated September 16, 2024
* 
* ![](https://www.servicenow.com/docs/portal-asset/ico-clock) 7 minutes to read

The Pricing Management application enables your organization to set, manage, and optimize pricing strategies for any Sales Customer Relationship Management solution. These pricing strategies enable your sales team to generate leads, opportunities, quotes, and orders with accurate and competitive pricing quickly.  
The Pricing Management application is the foundation of any Sales Customer Relationship Management solution, enabling your organization to set, manage, and optimize pricing strategies that maximize profitability while meeting customer expectations. Pricing Management provides various features to implement pricing in your organization.  
Note:  
Check your entitlements to determine if you have access to these features.

## Pricing plans {#pricing-management__section_gsl_c5d_tcc}

A pricing plan is a sequence of steps that control how pricing adjustments and calculations, such as the list price and discounts, are applied to price lines. You can have multiple pricing plans for your organization, but only one
active plan for each domain.

Pricing Management provides a default pricing plan with predefined steps. You can use the default pricing plan, or you can customize the default plan by copying it and adding steps or changing certain steps as
needed. To learn more about customizing a pricing plan, see [Configurable pricing plans](https://servicenow-prod.fluidtopics.net/2TBjbt6LSpHcr6y2PFi5MA "Pricing Management provides a default pricing plan that defines the sequence of steps in which pricing calculations and adjustments are applied to determine final product prices.").

## Price lists {#pricing-management__section_zxx_342_41c}

Price lists define the prices for products and services offered by your organization. Your agents use price lists to find product pricing quickly when creating quotes and capturing orders. Your pricing admins or managers create
price lists and add price list lines that define the list price for each of your product offerings. They can also copy a published price list and its price list lines and use the copy to update the pricing or reuse the price list
without having to create a new price list.  

Support for multiple price lists
:   Pricing Management supports multiple price lists, such as price lists based on currency or customer account. The initial, default price list that you create is based on the currency used, but you can change
    the default price list used by your agents. For example, you can create account-based price lists that are tailored to the needs and preferences of a specific customer or provide pre-negotiated prices for them. You can set an
    account-based price list as the default, which is then used by your agents when they create quotes or orders for that particular customer.  
    Figure 1. Example of account-based price list

Pricing methods
:   The pricing method is either a one-time fee or a recurring pricing fee with monthly and annual frequencies. The pricing method is set in product offerings and is displayed in price list lines.

For details on setting up and managing price list features, see [Configuring product pricing](https://servicenow-prod.fluidtopics.net/5ox~gOtMue85TBENCLXcuQ "Use the Pricing Management application to create the price lists and price list lines, define pricing adjustments, and manage other features that control pricing for product offerings. Product pricing is used by your sales and order agents when creating opportunities, quotes, and sales orders in Sales Customer Relationship Management.").

## Sales Agreement price lists {#pricing-management__section_lt2_yfb_wbc}

If you're using the Sales Agreement feature, a published sales agreement price list is generated automatically when a sales agent creates a sales agreement from a completed quote. The sales agreement price list reflects the final unit
price for each product that is captured as part of the sales agreement. The sales agreement price list is valid for the start and end dates specified for the agreement. To learn more about sales agreements, see [Sales Agreement Management](https://servicenow-prod.fluidtopics.net/tjTqRxkIeJyVm6PtB0E6wQ "Sales Agreement Management is an application that captures the scope and conditions from a quote for future sales transactions, over a specified period between a buyer and a seller.​").  
Figure 2. Example of sales agreement price list

When a quote is created for a sales agreement workflow, the sales agreement price list created is also used for orders generated from the sale agreement. The price list lines that are created maintain the
offer hierarchy (parent offer and any child offers) captured in the quote and sales agreement. The price list lines have a reference to the parent product offer and the root product offer, for tracing the offer hierarchy. In
addition, the unit net price in a sales agreement line is used as the list price in the associated price list line. The effectivity dates for price list lines are based on the start and end dates of the corresponding sales agreement
line item.

## Cost books {#pricing-management__section_hym_hlh_1bc}

Cost books define the unit cost for product offerings. This information is used in the Quote Management application to provide sales agents with the unit cost, unit margin amount, and unit margin percentage for products in quotes. With this information, your sales agents can perform a simple
profitability analysis by subtracting the cost of the product offer from the quoted selling price.  
Figure 3. Example cost book in quote details and margins in quote line

Your pricing admins or managers create a cost book and add a cost book line to set the unit cost for each product offering. They can also copy a published cost book and its cost book lines to revise costs in the cost book (update
the copy) or reuse a cost book without having to create a new one. For details on setting up cost books and cost book lines, see [Create and publish a cost book](https://servicenow-prod.fluidtopics.net/438002_SNxUpTL78sG3OoA "Create a cost book that defines the unit costs for products and services in Sales Customer Relationship Management.") and [Create a cost book line](https://servicenow-prod.fluidtopics.net/Puhss9DAEQ_nZ3asprQEHQ "Create a cost book line that defines the unit cost for a product offering."). For information on activating the cost book and cost margin features in Quote Management, see [Install and configure Quote Management](https://servicenow-prod.fluidtopics.net/_Cuoi8IMlb3EFd403RDU9w "Learn how to set up Quote Management so that your sales agents can create and manage customer quotes.").

## Price adjustments {#pricing-management__section_wj1_cqj_41c}

In Pricing Management, you can adjust the list price of your products by specifying a markdown or markup fixed amount or percentage, or a price override, based on the following features:

* Product attributes: Define a price adjustment based on product characteristics, such as model or color. For more information, see [Create and publish a product attribute-based pricing adjustment](https://servicenow-prod.fluidtopics.net/ZjHg2TWSMge5d9haGpazsg "Create a pricing adjustment for a product offering based on its product characteristics, such as the product size or color. A pricing adjustment can be a markup or markdown percentage, amount, or a pricing override.").
* Non-product attributes: Create a price adjustment based on characteristics that aren't related to a product, such as shipping information or sales channel. For example, you can create a pricing adjustment for customers in a particular region. For details, see [Create a non-product attribute pricing adjustment](https://servicenow-prod.fluidtopics.net/eHKkBoMX9yECYZzO2zLEnQ "Create a pricing adjustment for a product offering based on non-product characteristics, such as billing state or shipping zip code. You use the Standard Price Adjustment Matrix to define the pricing adjustment.").
* Bundled products: Create price adjustments for product offerings in a bundled product. For example, you might want to specify a markdown amount for certain product offerings in the bundle, because the bundle provides discounted pricing. For more information, see [Create pricing adjustments for bundled products](https://servicenow-prod.fluidtopics.net/AdbVCtgFgl7uwHtpSy2lEA "Define price adjustments for a product when it is sold as part of a product bundle. You use the Configuration Component Price Adjustment Matrix to set the price adjustments for child product offerings that are bundled under a parent product offering.").
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## Pricing matrices {#pricing-management__section_cdw_3sn_41c}

Pricing matrices are frameworks for setting conditions in decision rules, which enable you to implement complex pricing adjustments and manage default price list or cost book selection. For instance, if you have multiple price lists, you can use a pricing matrix to specify the conditions that determine the default price list to be applied when agents create a quote or order. Pricing Management offers the following matrices:

* Price List Defaulting: Select the default price list to be used, such as the standard price list or an account-specific price list. For more information on configuring this price list matrix, see [Control the default price list on transaction header or header line](https://servicenow-prod.fluidtopics.net/EuiCSaPuk7Z9XVISvF6~Qw "Define the default price list displayed to your sales and order agents on the transaction header or header line by using the Price List Defaulting Matrix.").
* Cost Book Defaulting: Select the default cost book to be used, for example the standard cost book or an account-specific cost book. To learn more about configuring this matrix, see [Control the default cost book on transaction header or header line.](https://servicenow-prod.fluidtopics.net/8UT2~30TBoy_yjJ9XQ7sdg "Set the default cost book displayed to your sales agents on the transaction header or header line for a Sales Customer Relationship Management application by using the Cost Book Defaulting Matrix.")
* Standard Price Adjustment: Apply an adjustment based on context variables that represent non-product attributes, such as shipping location or account. Pricing Management provides certain system-defined, non-product context variables that you can use in this matrix, but you can also create your own custom variables, for example, market segment. Your pricing administrator can work with your administrator to develop custom context variables that can be used in pricing matrixes. For details on configuring these adjustments, see [Create a non-product attribute pricing adjustment](https://servicenow-prod.fluidtopics.net/eHKkBoMX9yECYZzO2zLEnQ "Create a pricing adjustment for a product offering based on non-product characteristics, such as billing state or shipping zip code. You use the Standard Price Adjustment Matrix to define the pricing adjustment."). For more information on configuring custom context variables, see [Create a custom context variable](https://servicenow-prod.fluidtopics.net/KJieIvcITElz~KI1nBAXbA "Create custom context variables to represent product or non-product characteristics that can be used by pricing admins to apply control different pricing features, such as pricing adjustments, or product catalog admins to set product offering eligibility rules.") and [Map a custom context variable to a transaction entity](https://servicenow-prod.fluidtopics.net/F4_gioAl_EP6p14u_ZspaA "Associate a custom pricing context variable to a particular transaction entity type in Sales Customer Relationship Management.").
* Configuration Component Price Adjustment: Adjust the price of a product when it's sold as part of a product bundle. For details, see [Create pricing adjustments for bundled products](https://servicenow-prod.fluidtopics.net/AdbVCtgFgl7uwHtpSy2lEA "Define price adjustments for a product when it is sold as part of a product bundle. You use the Configuration Component Price Adjustment Matrix to set the price adjustments for child product offerings that are bundled under a parent product offering.").
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## Matrix validations {#pricing-management__section_a5h_nhb_wbc}

As an admin, you can use system-defined validations or set your own validations to validate rows entered into the decision tables for pricing and product eligibility rule matrices. For more information on these validations, see [Configuring matrix validation rules](https://servicenow-prod.fluidtopics.net/eNPoHwha8etJjE~i2n4wqA "As a product catalog admin or pricing admin, you can manage the system-defined matrix validation rules that automatically check the mandatory rule inputs or outputs in matrix decision tables. You can also define your own custom validations.").

## Revenue metrics for subscription pricing {#pricing-management__section_nwl_djt_ycc}

In the Opportunity and Quote Management applications, certain subscription-related revenue amounts are automatically calculated when your agents add products to opportunities and quotes. Agents and sales managers can use this information
to forecast subscription revenue and track sales performance. For details on these metrics, see [Subscription revenue metrics](https://servicenow-prod.fluidtopics.net/AA1mgwq5_rCSl16OvsoFyw "Subscription pricing is a pricing model where customers pay a recurring fee for products or services, usually at regular intervals such as monthly or annually. In Sales Customer Relationship Management, various subscription revenue amounts are calculated automatically for opportunities and quotes.").

## Pricing extensions {#pricing-management__section_dl3_gvq_41c}

Pricing extensions are integration points that your administrator can use to customize the pricing engine, giving you the flexibility to use pricing information from external sources or control the pricing engine processing logic. Pricing Management provides these extensions:

* Select Price List (DefaultPriceListExtensionPoint): Change the selection logic for using the default price list on a quote or order header.
* Select Cost Book (DefaultCostBookExtensionPoint): Change the selection logic for using the default cost book on a quote header.
* Get Product List Price (ListPriceExtensionPoint): Get pricing directly from another data source or extend the current price list derivation.
* Apply Attribute Adjustments (AttributeAdjustmentExtensionPoint): Get attribute adjustments from another data source, such as product manufacturers, or extend the current adjustment derivation logic.
* Get Cost (CostExtensionPoint): Get the unit cost for a product offering directly from another data source or extend the current cost book derivation logic.
* Apply Pricing Adjustments (PricingAdjustmentsExtensionPoint): Get pricing adjustments for a product offering from another data source, or extend the pricing engine logic by not relying on the Standard Adjustment and Component Configuration Rule Matrices to get the adjustment values.

{#pricing-management__ul_c4p_1yq_41c}To learn more, see [Use extension points in Pricing Management](https://servicenow-prod.fluidtopics.net/rhHcVIa5agkgDohlFTTulw "Use extension points to call custom scripts from external sources that control pricing logic used in the Pricing Management feature of the Sales Customer Relationship Management (SOM) applications.").