Pricing & Discounts
Business Central has a flexible pricing engine for both sales and purchases. Learn how to manage purchase prices, sales prices, line discounts, and invoice discounts — and how they interact.
How pricing works in Business Central
Think of BC’s pricing engine like a supermarket shelf with multiple price tags.
Walk into a supermarket: there’s the regular price on the shelf, a club member price, a bulk discount for buying 6+, and a coupon at the checkout. The till scans your loyalty card, checks your quantity, applies the best shelf price, then subtracts any coupon discount.
Business Central works the same way. When Leo at Summit Distribution enters an item on a sales order, BC checks: Is there a special price for this customer? A group price? A quantity break? Then it picks the best (lowest) price. After that, it checks for line discounts and invoice discounts — separate layers of savings.
Sales prices
Price lists — the modern approach
Since 2020 release wave 2, Business Central uses Price Lists as the primary way to manage prices and discounts. A price list is a collection of price lines that share common properties.
Each price list has:
| Field | Purpose | Example |
|---|---|---|
| Code | Unique identifier | SP-COASTAL-2025 |
| Description | Readable name | Coastal Traders 2025 Prices |
| Assign-to Type | Who it applies to | Customer, Customer Price Group, All Customers |
| Assign-to No. | Specific customer or group | C-COASTAL |
| Status | Draft or Active | Active (drafts are ignored in calculations) |
| Starting Date / Ending Date | When the prices are valid | 01/01/2025 to 31/12/2025 |
| Currency Code | Which currency | NZD, USD, or blank for local currency |
Each price list contains lines specifying the actual prices:
| Product Type | Product No. | Unit of Measure | Minimum Quantity | Unit Price |
|---|---|---|---|---|
| Item | BOLT-M8 | EACH | 1 | $0.80 |
| Item | BOLT-M8 | EACH | 500 | $0.65 |
| Item | BOLT-M8 | BOX | 1 | $60.00 |
Notice quantity breaks: buy 500+ bolts and the price drops from $0.80 to $0.65 each.
Who gets which price — the assign-to hierarchy
Prices can be assigned at different levels:
| Assign-to Type | Scope | Example |
|---|---|---|
| All Customers | Everyone gets this price | Published catalogue prices |
| Customer Price Group | A group of customers share prices | WHOLESALE group, RETAIL group |
| Customer | One specific customer | Special negotiated rate for Coastal Traders |
| Campaign | Linked to a marketing campaign | Summer Sale 2025 |
When Leo enters a sales order line, BC checks all price lists that could apply and picks the lowest price (best price for the customer).
Best Price Calculation — how BC picks the winner
When multiple price lists match a sales line, BC follows the best price principle:
- Find all active price lists where the Assign-to matches the customer (or their price group, or All Customers)
- Filter to lines where the date range includes the order date
- Filter to lines matching the item, unit of measure, and where the order quantity meets the minimum quantity
- Pick the line with the lowest Unit Price
If there’s a tie, BC uses the most specific source (Customer beats Customer Price Group, which beats All Customers).
The exam loves to test this. If a customer-specific price is $0.75 and the All Customers price is $0.70, BC picks $0.70 — because lowest price wins, not most specific source.
Date-effective pricing
Price lists have Starting Date and Ending Date fields. This lets you set up future prices in advance:
| Price List | Starting Date | Ending Date | Unit Price |
|---|---|---|---|
| SP-2025-H1 | 01/01/2025 | 30/06/2025 | $0.80 |
| SP-2025-H2 | 01/07/2025 | 31/12/2025 | $0.85 |
On 1 July, the new price automatically takes effect without anyone changing anything.
Purchase prices
Purchase prices work the same way through price lists, but applied to vendors instead of customers:
| Field | Sales Context | Purchase Context |
|---|---|---|
| Assign-to | Customer, Customer Price Group | Vendor |
| Direction | Sales | Purchase |
| Unit Price field | Unit Price (what you charge) | Direct Unit Cost (what you pay) |
Raj can set up vendor-specific price lists:
| Vendor | Item | Unit of Measure | Minimum Qty | Direct Unit Cost |
|---|---|---|---|---|
| Global Steel Co. | BOLT-M8 | BOX (100 pcs) | 1 | $45.00 |
| Global Steel Co. | BOLT-M8 | BOX (100 pcs) | 50 | $40.00 |
| Local Supplies Ltd | BOLT-M8 | BOX (100 pcs) | 1 | $48.00 |
When Nina creates a purchase order from Global Steel Co. for 60 boxes of M8 bolts, BC finds the $40.00 price (quantity break at 50+).
Line discounts vs invoice discounts
Business Central has two separate discount mechanisms. Understanding the difference is critical for the exam.
| Feature | Line Discount | Invoice Discount |
|---|---|---|
| What it reduces | The amount on a single document line | The total amount across the entire document |
| Based on | Item, customer/vendor, quantity, date | The total document amount exceeding a threshold |
| Where it appears | Line Discount % field on each line | Invoice Discount Amount field in document footer |
| Typical use | Volume pricing — buy 100+ widgets, get 10% off that line | Spend over $5,000 on one order, get 2% off the total |
| Configured in | Price List lines with Amount Type = Discount | Customer/Vendor card — Invoice Discounts page |
| Applied automatically? | Yes — BC checks price lists and applies the best discount | Only if Calc. Inv. Discount is enabled in Sales/Purchase setup, or user clicks Calculate Invoice Discount |
| Example | BOLT-M8: Buy 500+ = 5% line discount | Coastal Traders: Orders over $10,000 = 2% invoice discount |
How line discounts work
Line discounts are set up as price list lines with Amount Type = Discount:
| Assign-to | Item | Min Qty | Line Discount % |
|---|---|---|---|
| Customer: Coastal Traders | BOLT-M8 | 100 | 3% |
| Customer: Coastal Traders | BOLT-M8 | 500 | 5% |
| Customer Price Group: WHOLESALE | BOLT-M8 | 1000 | 8% |
When Sofia at Coastal Traders orders 600 M8 bolts, BC finds the 5% line discount (matches 500+ threshold) and applies it to that line.
How invoice discounts work
Invoice discounts are set up on the customer or vendor card, not in price lists:
- Open the Customer Card for Coastal Traders
- Navigate to Invoice Discounts
- Set up thresholds:
| Currency | Minimum Amount | Discount % |
|---|---|---|
| (blank = local) | $5,000 | 1% |
| (blank = local) | $10,000 | 2% |
| (blank = local) | $25,000 | 3% |
If Olivia’s team at Coastal Traders places a $15,000 order, they get 2% off the entire invoice total.
Important: Automatic invoice discount calculation
Invoice discounts are not calculated automatically by default. There are two ways to trigger them:
- Manually: User clicks Calculate Invoice Discount on the document
- Automatically: Enable Calc. Inv. Discount in Sales and Receivables Setup (or Purchases and Payables Setup for purchase documents)
If automatic calculation is not enabled, users might forget to apply the discount. Most implementations turn this on. The exam may test whether invoice discounts are automatically applied — the answer depends on this setup field.
How discounts stack
This is where students get confused. Prices and discounts are separate layers, and they stack:
Step 1 — Best price: BC finds the lowest unit price from all applicable price lists.
Step 2 — Line discount: BC finds the best (highest) line discount percentage from all applicable discount lines and applies it to the line amount.
Step 3 — Invoice discount: If enabled, BC checks the document total against the invoice discount thresholds and applies the percentage to the entire document.
Example at Summit Distribution
Raj sells 600 M8 bolts to Coastal Traders:
| Step | Calculation | Amount |
|---|---|---|
| Base price (All Customers) | 600 bolts at $0.80 each | $480.00 |
| Best price (Customer-specific, 500+ qty) | 600 bolts at $0.65 each | $390.00 |
| Line discount (5% for 500+) | $390.00 minus 5% | $370.50 |
| Invoice discount (if order total exceeds threshold) | Depends on total document amount | Calculated on total |
The price engine picked $0.65 (lower than $0.80), then applied the 5% line discount on top. These are not competing — they stack.
Exam tip: Discount calculation order
The exam may ask about the order of discount calculations. Remember:
- Best price is determined first (lowest unit price wins)
- Line discount is applied second (highest applicable % on that line)
- Invoice discount is applied last (on the full document total, after line discounts)
Line discounts and prices come from Price Lists. Invoice discounts come from the Customer/Vendor Card. They are configured in different places and applied at different stages.
Also note: Allow Line Disc. on the price list line controls whether a line discount can be applied on top of that price. If this is turned off, the special price already includes any discount, and no additional line discount applies.
Knowledge check
Coastal Traders (Olivia's company) has two applicable sales price lists for BOLT-M8: a customer-specific price of $0.75 and an All Customers price of $0.70. Which price does BC use on the sales order?
Raj has set up an invoice discount for a vendor: orders over $10,000 get 2% off. Nina places a $12,000 purchase order but sees no discount applied. What is the most likely cause?
A price list line for BOLT-M8 has Allow Line Disc. turned off. The customer also has a 5% line discount set up for BOLT-M8. What happens when a sales order is created?
🎬 Video coming soon
Next up: With pricing configured, we’ll move into how sales and purchase documents flow from creation through posting — the sales and purchase order lifecycle.