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2010/05/20

Discounts: Functional Details and Best Practices

Today I'm going to talk a bit about discounts – there are different ways you could go about discounting orders in NetSuite and in this blog post I’ll show you what I think is the most functional.

So, let's say I have an order as such as:
Item 1 - $100
Item 2 - $200

Let’s say you would like to offer your customer a $30 discount on this order.  One obvious simple way is to change my order to:
Item 1 - 100$
Item 2 - 170$

This will work – your customer is indeed only going to pay $270 rather than $300. But this solution is short-term and does not take into consideration the customer experience or your records keeping. For instance, using the above method you are not able to:

•    Show the customer how much money he is saving over the normal price.
•    Track your discounts, so that at the end of the year (or sooner!) you can run reports to see how much money you discounted away (and why).

A better way is using NetSuite Discount Items. These item types allow us to specifically create an item than can be added to transactions, and cause a discount. They can be configured as percentages or flat amounts.

Using Discount Items allows us to show the customer how much money they are saving, as well as being able to track exactly how much  money you discount as you do business.

To access the Discount Items, click List  ---> Accounting --> Items. Select NEW, and you will be given a list of items to choose from. Select DISCOUNT ITEMS.





When creating Discount Items, you also have the option of posting the amount discounted to a specific GL Account (very convenient because you can then view that  specific account to see all the discounts at once), or you can subtract the discount amount out of your Accounts Receivable account. Both methods are viable, it's  really just a matter of preference.

Please keep in mind that Discount Items are different than Price Levels. When you have specific pricing for specific classes of customers, that's Price Levels. Discounts should be used when you need to lower the price of an order for unplanned reasons (special agreement with a customer, when running specific marketing campaigns, etc.)

But my point is - when discounting, don't edit the price of the item. Use a Discount Item!

2 comments:

  1. Hello ,
    Can you tell me how can we use these discount item . i want to give the discoun to customer based on subtotal amount in the shopping cart without using promotion code.

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  2. Hello

    If I understand correctly, you want to automatically add a discount item in the customer's cart when they buy at least X amount.

    The problem with this is not the Discount Item, it's that you'll need scripting (most likely via Scriptable Checkout) to get the item to be properly added automatically.

    The Discount Items themselves cannot be configured to add themselves via a given logic; you'll need scripting for that.

    However, using scripting, what you outline is indeed very possible.

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