Price calculation for Microsoft New Commerce Experience annual commitment with monthly billing
Introduction
This article explains how pricing is calculated for Microsoft New Commerce Experience Products with Annual Billing (P1Y) commitment and Monthly Billing cycles. Understanding this calculation will help you accurately predict Customer pricing and margins.
In this article:
How the price calculation works
For Microsoft New Commerce Experience Products with Annual Billing commitment and Monthly Billing cycles, the Platform calculates the monthly Customer Price using the following formula:
Where:
• Suggested Retail Price is the annual price from the Microsoft price list
• 12 months represents the number of billing cycles in the annual commitment
• Markup is the percentage adjustment applied by the Seller (can be positive or negative)
Price calculation example
Here is a demonstration using a Microsoft New Commerce Experience Product with a Seller Markup of -10%:
| Product ID | Product Title | Term Duration | Billing Cycle | Currency | Suggested Retail Price |
|---|---|---|---|---|---|
| CFQ7TTC0LF90 | Dynamics 365 Remote Assist | P1Y | Monthly | EUR | 657.6 |
- Take the annual Suggested Retail Price: 657.6 EUR
- Divide by 12 months: 657.6 EUR ÷ 12 = 54.8 EUR
- Apply the -10% Markup: 54.8 EUR × (1 - 0.10) = 49.32 EUR
| Billing Cycle | Cost Price | Suggested Retail Price | Customer Price | Your Margin |
|---|---|---|---|---|
| Total monthly | 43.84 | 54.80 | 49.32 | 5.48 |
Summary
For Microsoft New Commerce Experience Products with Annual Billing commitment and Monthly Billing cycles, the Platform calculates the Customer Price by dividing the annual Suggested Retail Price by 12 months and applying the Seller Markup percentage. In the example provided, an annual Suggested Retail Price of 657.6 EUR with a -10% Markup results in a monthly Customer Price of 49.32 EUR. This calculation ensures transparent pricing across all billing cycles while maintaining consistent margin calculations.
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