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Pricing Engine Overview

Catalogs contain products, and each catalog has its own default base price list and base promotion list. These lists store base price entries for all product SKUs in the catalog and are available to all customers. You can also create custom price lists and promotion lists to define more targeted and configurable price entities. As part of each entry, you can also define price tiers that set special prices for products based on quantity. Finally, discounts are applied on top of price entries without overriding them.

Note

The following overview describes Commerce Pricing Engine v2.0. This is the default pricing algorithm used for Commerce 3.0+ and Portal/DXP 7.3+. Earlier versions (i.e., Commerce 2.1.x) use Pricing Engine v1.0 by default. If desired, you can change the pricing engine version used for the instance.

Liferay DXP 2023.Q4+/Portal GA98+ If you have a unit of measure configured for the SKU, you have entries for each unit in the base price list, base promotion list, custom price lists, and custom promotion lists.

The base price list also stores the starting price for every unit configured for an SKU.

Base Price List

The base price list stores the starting price for every product SKU in a catalog. These entries set the standard currency and price used for each SKU when no overrides are applied to it. This list is created automatically for every catalog and is available to all accounts and channels. See Setting a Product’s Base Price to learn more.

The base price list stores the starting price entry for every product SKU in a catalog.

Base Promotion List

The base promotion list stores base promotional price entries for all product SKUs in a catalog. When applied to an SKU, the base promotional price entry overrides its base price for all customers. This list is created automatically for every catalog and is available to all accounts and channels. See Promotion Base List Reference for more information.

The base promotion list stores base promotional price entries for all product SKUs in a catalog.

Price Lists

Custom price lists store price entries for specific products and are available only to eligible customers. These lists can use a different currency from the base price list and can include all or only some of a catalog’s products. A custom price list entry override an SKU’s base price for eligible customers. You can also define Price Modifiers to modify specific price entries. See Creating a Price List for more information.

Use custom price lists to store more targeted price entries.

Promotion Lists

Custom promotion lists store promotion price entries for specific products and are available only to eligible customers. These lists can use a different currency from the base price list and include all or only some of a catalog’s products. When applied, they override other price entries of an SKU (e.g., base prices, tiered prices) for eligible users. In these lists, you can also define Price Modifiers to modify specific price entries. While active, both the original price and promotional price appear together on the Product page so that buyers see the markdown. See Creating a Promotion for more information.

Use custom promotion lists to store targeted promotion price entries.

Note

Before Liferay DXP 7.4 U42/GA42, Promotion Price was called Sale Price.

Price Tiers

Price tiers are set directly within a price entry and define specific prices for orders that meet minimum quantity requirements. These prices appear to customers as discounted order options. See Using Price Tiers for more information.

Discounts

Discounts are applied on top of the price and modify it without superseding it. They can be defined within an existing price entry, or created as separate entities and used to target products, product groups, categories, shipping costs, subtotals, or totals. See Introduction to Discounts to learn more.

Discounts are applied on top of the price and modify it without superseding it.

How the Pricing Engine Calculates Product Prices

The pricing engine determines how each pricing component contributes to an SKU’s price in a channel. When the engine receives a price request, it first calculates the product’s unit price and promotion price. These prices are then used to determine the final price made available to the customer.

Liferay DXP 2023.Q4+/Portal GA98+ The pricing engine calculates the unit price, promotion price, final price, and order price the same way for an SKU containing units of measure as an SKU without units of measure.

Calculating an SKU’s Unit Price

When calculating an SKU’s unit price, the pricing engine searches for eligible custom price lists. If multiple lists exist, the engine selects the list with the highest priority. Then, it searches the selected list’s price entries for the product SKU.

If an entry for the SKU exists, the algorithm applies any existing price modifiers to it and uses the total for the SKU’s unit price.
If no entry for the SKU exists, the engine uses the SKU’s base price and applies modifiers from the highest priority price list. The total is the SKU’s unit price.

Note

The engine only searches the highest priority list and does not search for the SKU in lower priority lists. This is to avoid applying prices from different price lists to SKUs in the same catalog.

If no eligible custom price list exists, the engine uses the SKU’s base price list entry for the unit price.

The engine searches eligible custom price lists for the SKU.

Note

During this process, the engine also checks for applicable tier prices. If one exists, its price is used in place of the default list price for specific quantities.

Calculating an SKU’s Promotion Price

After calculating the SKU’s unit price, the pricing engine calculates the SKU’s promotion price. This calculation is essentially the same as the process for calculating the unit price with two exceptions:

If an applicable promotion list does not have a price entry for the SKU, any existing price modifiers are applied to the unit price, and the total is used for the promotion price.
If there is no applicable promotion list and the base promotion list is set to 0, the promotion price is set to 0.

Calculating an SKU’s Final Price

After calculating the unit and promotion prices, the pricing engine compares them and selects the lower price. The pricing algorithm then searches for all applicable discounts and applies them to that price. The total is the SKU’s final price: the price the customer pays to purchase the product.

How the Pricing Engine Calculates Order Prices

When calculating order prices, the pricing engine first retrieves the shipping costs and applies any discounts that target shipping.

Then, the engine determines the subtotal by adding the final prices of all SKUs in the order. Any discounts targeting the subtotal are then applied.

Finally, the pricing engine adds together the discounted shipping cost and discounted subtotal to get the order’s total. Any discounts targeting the total are then applied.

The engine determines the order's shipping, subtotal, and total.

Pricing Engine v1.0 Reference

Pricing Method	Summary	Overrides the Base Price?	Where is it set?	Applies to who?	Applies to what?
Base Price	The base price	n/a	Product SKU	All buyers	Product SKU
Base Promo	Marked down price	Yes	Product SKU	All buyers	Product SKU
Price List (List Price, List Promo)	Special pricing (or currencies) per product and buyer	Yes	Price Lists	Selected buyers (Accounts & Account Groups)	Individual Product SKUs
Tiered Price List (Tiered Price, Tiered Promo)	Special pricing (or currencies) per product and buyer at bulk quantities	Yes	Price Lists	Selected buyers (Accounts & Account Groups)	Individual Product SKUs
Discount	Modifies price for a group of products or buyers (Can limit quantity and use coupon codes)	No	Discounts	Selected Buyers (Accounts & Account Groups or those who meet certain qualifications)	Groups of Products (or Individual Product SKUs)