What is Soft and Hard Limit?

Introduction

Soft and Hard Limits are used to safeguard Partner users from setting prices lower than costs and to avoid excessive discounting.

In this article:

• Hard and Soft Limits configuration
• Limits Calculation

Hard and Soft Limits configuration

The Soft Limit defines the limitation for the Account Manager role while the Hard Limit defines the one for the Seller admin.

Limits Calculation

For example, a user with the Seller admin role has set:

1. Price Source: Retail Price (this is by default setup).
2. Markup: 0%
3. Soft Limit: 20%
4. Hard Limit: 10%
5. Cost Price: 3.37 EUR
6. Retail Price: 4.20 EUR

When applying calculations: 

• Soft Limit defines the minimum allowed price to be set by Account Managers:
  • x = 3.37 EUR + 20% = 4.04 EUR
  • As such, the Account Manager can give a maximum discount of 3.8% from Retail Price for this offer:
    • (4.20-4.04)/4.20 *100% = 3.8%
• Hard Limit defines the minimum allowed price to be set by Seller Admins:
  • x = 3.37+10% = 3.71 EUR
  • Thus, the Seller Admin can give a maximum discount of 11.7% from Retail Price for this offer:
    • (4.20-3.71)/4.20 *100% = 11.7%

1) If Price Source = InPrice: 
    Soft Limit ≥ Hard Limit ≥ Markup 
    & Markup ≥ 0

2) If Price Source = Retail Price: 
    Soft Limit ≥ Hard Limit
    Markup ≥ [(InPrice - Retail Price)/Retail Price] x 100%

Summary

Soft and Hard Limits are pricing safeguards that prevent Partner users from setting prices below costs and avoid excessive discounting. The Soft Limit applies to Account Manager roles while the Hard Limit applies to Seller admin roles, with both limits configurable in the Platform settings. These limits are not simple percentage discounts but are calculated based on the Cost Price plus the specified limit percentage to determine the minimum allowable Customer Price. Both limits define Markup on top of the Cost Price and remain independent of the selected Price Source when configuring pricing. Note that price configuration based on Suggested Retail Price can incur losses if Cost Price exceeds the discounted Suggested Retail Price, and specific mathematical conditions must be met depending on whether Cost Price or Suggested Retail Price is selected as the Price Source.