Discounts are used only when entering tickets for customer sales. How payment discounts are calculated for a customer depends on the customer’s assigned payment terms.
Rate-Based Payment Terms
If a customer’s payment terms are rate-based (the Discounts Based on Material option in HQ Payment Terms is not checked), the discount offered is calculated using the discount percent specified for the payment terms. Rate-based discounts are always calculated on the sale total.
Material-Based Payment Terms
- The system checks for a quote, and if one exists, looks to see if a discount override exists for the material or material category. If one exists, that rate or amount (depending on the Payment Discount type specified for the material in HQ Materials) will be used.
- If a quote with a discount override does not exist, the system then uses the discount template specified on the quote.
- If a discount template is not specified on the quote, the discount template specified for the customer in AR Customers is used.
- If no discount template is specified for the customer, the discount specified for the material in HQ Materials is used. If unit-based, the discount offered is calculated on units sold. If rate-based, it is calculated on the material total.
Discount templates are used for defining discount rates for material-based discounts. They are not required, but they do allow you to tailor payment discounts for specific materials or material categories. Also, by assigning the templates to customers (in AR Customers), you can control the discounts offered by customer. For example, you may have customers that frequently buy large quantities of a specific material. By setting up the material on a discount template, you can assign an appropriate discount to that material, then restrict to which customers you assign the template. However, customers will receive the discount for that material only if the customer’s payment terms are material-based. Discount templates are set up in MS Payment Discount Templates.