Getting started with Unified Pricing Management in Dynamics 365 F&O

Understanding core pricing concepts in UPM

The Unified Pricing Management (UPM) engine in Dynamics 365 determines prices and discounts in real time based on four key components:

1. Attribute groups
2. Price attribute groups
3. Price component codes
4. Price tree

  These elements work together to create a flexible, rules-based pricing structure. Understanding how they connect is essential for accurate configuration and effective pricing management. Here is each concept and its role in the pricing process.

1: Attribute groups

Attributes is an extensible framework in D365FO that allows capturing extra information for products, Customers, and orders themselves. Attributes can be any additional property, for example, a Product has a property named Material (e.g., Fiber, Plastic, Wood, etc.), a customer has a region (e.g., “USA”, “UK”, etc.), and an Order has a delivery mode (e.g., “Air”, “Truck”, etc.). Businesses can define unlimited attributes in the PIM module (detailed steps provided in the section named “Configuring Unified price management”), which will then be used by Unified Pricing management to determine pricing & discounts in a sales order.   Path: Product information management > Setup > Categories and attributes > Attribute groups/Attributes

Figure 1: Showing “Attribute group” defined for Products

2: Price Attributes group

Although businesses can define a great number of attributes with Product, Customers, and stores for sales performance analysis or other reasons. However, businesses need to select specific attributes for “Product, Customer, and Orders” and define “Price attribute groups” that UPM will use to determine prices or discounts in sales orders. This enables UPM to determine the prices defined based on Product attributes, customer attributes, and order attributes rather than relying only on individual item codes or customer groups (we will demonstrate this in the section named “Configuring Unified Pricing Management”). We will set up price attribute groups for Order Header & Line.

• Header: Price attribute group will represent Customer attributes like customer account, group, region, and sales table (like mode of payment or mode of delivery)
• Line: Price attribute groups for Line will represent Product attributes, such as Material, Brand, Type, Category, etc.

  Path: Pricing management > Setup > Price > Price attribute groups > Price attribute groups 

Figure 2: Showing “Pricing attribute groups” for Products, in which we have picked selective attributes for pricing

3: Price component codes

A sales price comprises different components like “Price”, “margin”, “discount”, “charges”, and “rebate”, which are called “price components”. These components are independently managed and composed into the final price calculation. You can check out the Price component code details at the Microsoft learn website. The “Price component codes” in UPM combine “Price attribute groups” together with “Price components”. So, depending on requirements, the business will define “Price component codes” for base price, discount, charges, and rebates using the “Price attributes groups”. Path: Pricing management > Setup > Price component codes > Price component codes Note: You can have a maximum of one “price component code” record for each of the following price components:

1. Base price - Inventory price
2. Base price - Purchase price
3. Base price - Sales price
4. Sales trade agreement

On the other hand, you can have any number of price component code records for each of the remaining price components.

Figure 3: Showing the list of “Pricing component types” available for pricing in UPM

4: Price tee

In UPM, “Price tree” defines the “pricing sequence” in which the pricing engine evaluates each type of “price component (e.g., base price, adjustment, discounts, charges, etc.)” to calculate the final sales price in the sales order. A price tree may have multiple discounts with priority and date ranges to manage seasonal adjustments, which are evaluated using “pricing sequence”. Additionally, the price tree enables businesses to define how each price component is posted to the general ledger, which is managed through the “Posting profile” option available with the price tree. The “pricing sequence” can be a number from 0 to N; the lower the number, the higher the priority. The “price tree” information is part of each order attribute, allowing the pricing engine to select the price components according to the pricing sequence. For details, you can check out the Pricing structure overview on the Microsoft learn website.   Path: Pricing management > Setup > Price component codes > Price tree

Figure 4: Showing the use of Price component codes in “Price tree” with pricing sequence in UPM Now that you have understood the working model of the unified pricing engine, let’s start configuring the Unified Pricing Management module according to your business needs and verify its functionality using a few pricing scenarios.

Conclusion

Implementing Unified Pricing Management in Dynamics 365 Finance & Operations transforms the way organizations manage pricing by centralizing control, simplifying complex configurations, and ensuring consistent pricing across all channels. This flexible, attribute-based framework not only improves pricing accuracy but also enhances operational efficiency and governance. At Confiz, we help businesses unlock the full potential of D365 Unified Pricing Management by delivering scalable, secure, and business-aligned pricing solutions that drive growth. From initial setup to advanced configuration, our experts ensure a seamless deployment tailored to your unique pricing strategies. Looking to optimize pricing in D365 F&O? Contact us at marketing@confiz.com to explore how we can help.