Calculation Results Generation and their Interpretation
● On the graphs, the horizontal axis shows the relative (relative to the base list price) unit price of the product, and the vertical axis shows the absolute gross price value of purchases made over the monitoring period.
● On the first graph, the calculated demand price curve is plotted and the points plotted in red are base values for point calculation, corresponding to the real sales volumes in each of the price segments.
● On the second graph, there is the same calculated demand price curve and, on it, the points corresponding to the optimal Discounts System are marked and numbered. These points define the rectangles of the price segments, the area of each of them is equal to the marginal profit (or gross revenue) in each segment. On the left, the rectangles are aligned on a vertical line determined by the relative cost of the product (or by a maximum allowable discount). The rectangles are shaded in blue with alternating intensity. The total area of the aggregate of price segment rectangles gives the maximum possible marginal profit (gross revenue) that can be achieved with a given number of discounts in the Discount System for given market conditions.
● Graphs 1 and 2 are illustrative and serve for understanding the calculation results to implement in practical work.
● Table 1 is a structured Discounts System. Each table row contains an optimized discount amount, as well as the start and end of the discount range. In addition, at the bottom of each row, yellow in color, the same parameters of the Discount System before optimization are given.
● Table 2 shows the values of the existing and forecast (after optimization) revenue (profit), the percentage of increase and the potential maximum value of revenue (profit). The latter value is an integral characteristic of the market under consideration and corresponds to the case of unlimited expansion of the Discount System (an increase in the number of applied discounts).
● For the practical implementation of the optimized Discount System, it is necessary to take into account the change of the base (list price) unit price as a result of optimization, which is also calculated by the COD. The data on this value before and after optimization are shown in Table 3.