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  • 1.  How to define Cost of Product Offering

    TM Forum Member
    Posted 19 days ago

    Hi All,


    Have some doubts related to cost of the product offering.


    Objective:
    For B2B (Business to Business) scenarios we need to calculate profitability for the Product Offering, so here need to define Cost of the Product Offering.

     

    In GB922-Product, we have reference of "ProductSpecificationCost" at Product Specification level. So does this mean, we need to define the Cost of product offering at Product Specification level? If yes, then there could be scenarios where different product offering may have different cost for the same specification. Then how to handle such scenarios?

     

     

     

     

    There is no reference of Cost in TMF Open APIs. If you have any examples/models/references where cost of the product offering have been defined then please share the same.

    Regards,

    Sandeep Munde
    +91 9850002868



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    Sandeep Munde
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  • 2.  RE: How to define Cost of Product Offering

    TM Forum Member
    Posted 18 days ago
    Hi Sandeep

    A Cost API has been is in the state of design, but it appears to have been reduced in priority.
    I shall refer this post to them so that we can see what the current state is.

    Specifically regarding your query, to me it makes sense that the cost is at the level of spec. Of course the cost may depend on the value of characteristics set in the catalog or at ordering time - I'm not sure that the information framework (SID) fully captures that dependency - @Cecile Ludwichowski what do you think?​

    Hope it helps

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    Jonathan Goldberg
    Amdocs Management Limited
    Any opinions and statements made by me on this forum are purely personal, and do not necessarily reflect the position of the TM Forum or my employer.
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  • 3.  RE: How to define Cost of Product Offering

    TM Forum Member
    Posted 18 days ago
    Hi Sandeep,
    Cost management API is now in pipeline and we will be starting working on that API specification soon. Happy to collaborate with you to understand your requirements.

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    Varun Nair
    Telstra Corporation
    Note: This is an opinion based on my research and not an official TMF response.
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  • 4.  RE: How to define Cost of Product Offering

    TM Forum Member
    Posted 18 days ago
    Hi,

    Linking Cost to ProductOffering or ProductSpecification is violating the separation of concerns principle.

    Most costs result from the Production domains. Therefore costs must be associated to the appropriate entities from those productions domains.

    I will try to give a few examples that come from extensions to the models that we have build for some of our customers.

    1. smartphone sales.
    Service providers will typically to sell a range of different smartphone. The ResourceSpecification "smartphone" has a continously changing list of ResourceCandidates representing the models that I am currently buying. The Supply Chain department will maintain their ResourceCandidates in their catalog. Product Management gives each smartphone its own price
    2. Home Gateway sales
    The customer can't choose which model of homegateway he receives. This is decided later in supply chain. The customer pays one prices independent on the model he receives. Supply chain agrees purchase cost with vendors.

    3. Installation
    The service provider provides installation. There is a fixed cost for activities.

    4. NetworkService
    The most difficult scenario is the networks service. In this case there is probably no cost that is direct attributable.
    The ServiceProvider has invested in a network (assets). The cost of the network is now the depreciation cost of these assets.
    Profitability of the network service therefore is an accounting exercise and this depreciation cost is not really reflected in the TMF datamodel.

    There is obviously further detailing required to come to a complete model.
    I hope this helps as a starting point.

    Regards





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    Koen Peeters
    OryxGateway
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  • 5.  RE: How to define Cost of Product Offering

    TM Forum Member
    Posted 17 days ago
    Hi Koen,

    nice post again. I agree with you, that most cost are RFS related.

    My opinion is that (very simply put), cost of product is sum of all costs of resources (physical, logical, human, 3th party) needed to provide product instance.

    Jan

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    Ján Krištof
    T-Mobile Czech & Slovak Telekom, a.s.
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  • 6.  RE: How to define Cost of Product Offering

    TM Forum Member
    Posted 12 days ago
    Hi Koen,

    Thanks for response, In our scenario mostly we are not having Candidates (Resource/Service) so associating Cost with Candidates is not possible. But in your case how you are handling the cost for multiple variants basis of specCharacteristics values which are defined at specification level. Example: 256 GB smartphone variant will have different cost than 64/128/512 GB variant of smartphone.

    Regards,
    Sandeep Munde
    +91 9850002868

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    Sandeep Munde
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