Pricing tiers can be calculated in how many ways?

Pricing tiers in SAP Ariba are typically established to provide a structured approach to pricing that can adapt based on various conditions like volume, time periods, or specific contract terms. The correct understanding is that there are typically two primary methods to calculate pricing tiers:

1. Quantity-based pricing: This method adjusts the price based on the quantity of goods or services purchased. The more units bought, the lower the price per unit typically becomes, encouraging bulk purchases.

2. Tier-based pricing: Under this method, different price levels are established based on pre-defined thresholds, allowing pricing to fluctuate according to the tier a buyer meets based on their purchase quantity or other criteria.

This dual approach allows businesses to create flexible pricing models that can respond to changes in order volumes or customer behaviors effectively. Thus, understanding that there are two main ways to calculate pricing tiers is essential for proper application in procurement practices.