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March 29, 2022Process Options to Create Return on Investment
March 29, 2022Concession 1210: Discount Approval Policy
Overview
The following table lays out the approval levels based on a customer’s qualifications. The customer must acquire the appropriate level of approval to receive the discounts, otherwise their order cannot be processed.
Risk
Discounts create incentives for customers to order more, however they create a loss in revenue so they should be offered only when necessary to close the deal. Even small discounts are desirable to customers, therefore the lowest discount possible should be given to entice the customer to purchase the products without significant loss of revenue.
Approval Requirements
|
Discount Percentage Caps |
||||
|
Customer Type |
Desktop Count |
Level 1 Approval |
Level 2 Approval |
Level 3 Approval |
|
Government |
< 1,000 Desktops |
Up to 5% |
Up to 20% |
Over 20% |
|
1,000 – 4,999 Desktops |
Up to 10% |
Up to 25% |
Over 25% |
|
|
5,000 – 9,999 Desktops |
Up to 15% |
Up to 30% |
Over 30% |
|
|
10,000+ Desktops |
Up to 20% |
Up to 35% |
Over 35% |
|
|
Corporate |
< 1,000 Desktops |
Up to 15% |
Up to 40% |
Over 40% |
|
1,000 – 4,999 Desktops |
Up to 25% |
Up to 50% |
Over 50% |
|
|
5,000 – 9,999 Desktops |
Up to 35% |
Up to 60% |
Over 60% |
|
|
10,000+ Desktops |
Up to 45% |
Up to 70% |
Over 70% |
|
|
Discount Amount Caps |
||||
|
Customer Type |
Desktop Count |
Level 1 Approval |
Level 2 Approval |
Level 3 Approval |
|
Government |
< 1,000 Desktops |
Up to $25,000 |
Up to $50,000 |
Over $50,000 |
|
1,000 – 4,999 Desktops |
Up to $50,000 |
Up to $100,000 |
Over $100,000 |
|
|
5,000 – 9,999 Desktops |
Up to $75,000 |
Up to $150,000 |
Over $150,000 |
|
|
10,000+ Desktops |
Up to $100,000 |
Up to $200,000 |
Over $200,000 |
|
|
Corporate |
< 1,000 Desktops |
Up to $50,000 |
Up to $100,000 |
Over $100,000 |
|
1,000 – 4,999 Desktops |
Up to $100,000 |
Up to $200,000 |
Over $200,000 |
|
|
5,000 – 9,999 Desktops |
Up to $150,000 |
Up to $300,000 |
Over $300,000 |
|
|
10,000+ Desktops |
Up to $200,000 |
Up to $400,000 |
Over $400,000 |
Exceptions
1. To be approved for these discounts, the average price per desktop (total order amount/number of desktops) must be at least $50 per desktop after the discounts are applied.
2. The following countries are out of scope for the above discounting guidelines.
· Russia
· China
· South Africa
· Spain
· Italy
· Argentina
· Germany
3. Promotional products cannot be discounted under Level 1 or Level 2 approval. If discounts are required, they should obtain Level 3 approval.
4. For all LinkedIn products, please reference Concession 1311 for discount requirements.
5. Customer Relations products may not receive any discounts.
6. For any variations to this concession, please consult with the Discount Review Desk.
Please use the Concession 1210 document provided to answer the following questions.
1. What is the risk to giving customers discounts on their order?
2. What is the maximum discount amount that can be approved by Level 2 for Government customers?
3. What concession should be referenced for discounts on LinkedIn products?
4. For a Government Customer with 150 desktops, what is the approval level for applying 7% discounts on 2020 promotional products?
5. A Corporate Customer in the United States has 7,250 Desktops. They would like a 22% discount on their order for Sales Hub products. The total price before discounts is $895,375.00. Their price after discount is $698,392.50.
a. Does this qualify for the discounts in Concession 1210? Why or why not?
b. What is their average price per desktop after discounts are applied?
c. What is the total discount amount?
d. If they qualify for Concession 1210, what is the appropriate approval level for the discount percentage?
e. If they qualify for Concession 1210, what is the appropriate approval level for the discount amount?
6. A Government Customer who is based in Italy has 14,150 desktops. They would like to have a 15.75% discount on their order of GitHub products. Their order before discounts is $1,698,000.00.
a. Does this qualify for the discounts in Concession 1210? Why or why not?
b. What is the total discount amount for this order?
c. If they do qualify for Concession 1210, what is the appropriate approval level for the discount percentage?
d. If they do qualify for Concession 1210, what is the appropriate approval level for the discount amount?
