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Are you(r) prices up to date?

Managing commodity prices can be a tough challenge for companies. How do you do it? We've seen various examples and solutions on how to tackle them.


Managing commodity prices can be a tough challenge for companies. Whether you procure commodities or use them for your product: having accurate, real-time information about the prices is crucial to make informed decisions and reduce processing costs. We’ve seen companies facing the problem of working with outdated prices in different sectors. So, we wondered: How are you keeping your prices up to date?


What are commodities and why should you care?

Commodity is a term used to describe raw materials or goods that can be bought and sold or exchanged for products of similar value. In a broader sense, commodities include all movable goods like business assets, capital goods, consumer goods, and raw materials.

A commodity is usually

Example of commodities traded worldwide

In short: companies, especially manufacturing companies, need commodities to run their business. And if the prices of the commodities change, it can have a great impact on them.


Why are up-to-date prices so important?

Based on our customer projects we had the opportunity to understand the different business needs and aspects of what it means if (commodity) prices are not updated regularly. Here are a few examples:

A good example of why it’s important is this picture (generated by DALL-E), which depicts a potential supplier handling his customer demands:

And what did your customers do to tackle the problem?

Well, all our customers did something. Here is a list of what we experienced:

As you can see – there are quite a few options of how to tackle the problem of outdated prices…


So, what do we recommend?

Well, as consultants we always say: “it depends” 😊

Depending on how important (and how big the volume) is that you work with commodities, the different your approach should be.

If you have 3 purchase orders per year where accurate market prices are needed: follow a manual approach!

If however, there are many business transactions per week that require processing and your (purchasing) volume goes beyond the 10 millions, then it’s certainly worth to have a look at either a custom solution or the SAP Commodity Pricing Engine.

As official SAP partners, we recommend having a look at the SAP CPE.

If you have any questions, disagree or want to add your 2 cents: feel free to get in touch directly! ->

Have a good day!

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Published on 10. November 2023