Shipping cost calculations

  • Release version: Washingtondc
  • Updated February 1, 2024
  • 2 minutes to read
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    Summary of Shipping Cost Calculations

    The Shipping Cost Calculations framework facilitates the integration of shipping estimates into Purchase and Receipt Automation, allowing for comprehensive approval processes tied to the total value of purchases. This ensures that all involved parties have a clear understanding of shipping costs prior to purchase finalization.

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    Key Features

    • Shipping Estimates by Administrator: Administrators can configure a default shipping estimate as a percentage for all purchases lacking specific estimates, using the snshop.default.shipping.estimate property. This is particularly useful for organizations with defined shipping cost thresholds.
    • Approval Process Inclusion: Shipping estimates can be included in purchase requests for approval, controlled by the snshop.shipping.estimate.inclusion property. When set to true, shipping estimates from the cart are included in the purchase line total; if false, shipping is excluded from both the approval process and checkout calculations.
    • Buyer Customization: Buyers can set shipping estimates at the supplier and product levels. These estimates can be tailored for specific suppliers or products, ensuring accurate shipping costs for each order.

    Key Outcomes

    By utilizing these features, organizations can ensure accurate shipping cost calculations and streamline the purchase approval process. This results in better budget management, clearer communication of costs, and enhanced control over purchasing decisions. The prioritization logic used in calculating shipping estimates based on item type (goods vs. services) helps maintain transparency in pricing during the purchasing process.

    A framework to integrate shipping cost calculations into Sourcing and Purchasing Automation is implemented such that approvals can be done on the full value of purchases.

    Shipping estimates can be provided by both the ShoppingHub administrator and the buyer.

    Shipping estimates from ShoppingHub administrator

    A ShoppingHub administrator can set a default system-wide shipping estimate as a percentage. This can then be applied to all purchases that require shipping, when no other shipping estimates or data exist. This is enabled through a system property sn_shop.default.shipping.estimate. Organizations that have a policy around an acceptable threshold shipping cost might want to enter the threshold in the sn_shop.default.shipping.estimate.

    A ShoppingHub administrator can also configure shipping estimates to be included in purchase requests for the approval process. This is enabled through a system property sn_shop.shipping.estimate.inclusion, which is included in purchase request approvals. If this inclusion is marked as true, the shipping estimate from the cart line or checkout is included as a field in the purchase line and in the total amount in the purchase request, while the estimate in cost allocation is not considered. However, if this inclusion is marked as false, not only would shipping be excluded in the purchase request approval process, but also not calculated at checkout, even if data is included at the product, supplier, or system levels.

    Note:
    When a purchase request becomes a purchase order, the shipping estimate is not included in the total amount.

    Shipping estimates from buyer

    A buyer can set shipping estimates at the following levels:
    • Supplier:

      Set a standard percentage estimate for shipping costs from a specific supplier. This estimate is then applied to all the orders that require shipping from that supplier, which do not have any estimate at the product level. In the Purchasing Automation tab of the supplier record, enter a shipping estimate value in decimal in the Default shipping estimate for products from this supplier (calculated as percentage of negotiated unit price) field.

    • Product:

      Set a default shipping estimate for a supplier product record. This is then prioritized in estimating the shipping cost of a purchase over any supplier level estimate or default shipping estimate. In the Purchasing Automation tab of the supplier product record, enter a shipping estimate value in decimal in the Default shipping estimate for this supplier product (calculated as percentage of negotiated unit price) field.

    Note:
    The entered decimal values are stored in percentage. For example, a shipping estimate value of 10.5 is stored as 10.5%.