Telus TPM Documentation
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Probable Exposure Explained
Probable Exposure is the amount of dollars you'll need to set aside to pay for everything you've offered in the contract. The easiest way to explain is with a simple example where you offer $2/case and the Estimated Quantity of cases they say they'll buy is 100 cases. This means you need to be prepared to pay out $200(100 x $2/case). This doesn't mean you will pay this out. The contractee might only buy 50 cases…or might buy 200 cases.
Here's how it works:
We'll use this screenshot as the example.
Scenario 1: Direct Fixed Rate - estimated cases are 500 and the direct rebate is $2.15 so it's 500 x 2.15 = $1075.00. Scenario 2: Deviated Fixed Rate - similar to scenario 1 above but this is a deviated rate through the distributor. The calculation is the same in this scenario so for the first product it is 500 x $2.00 = $1000.00. Scenario 3: Deviated Fixed Price. The default price for this product is $12.34 and the fixed price is $11.00, the formula takes the difference of the two and then multiplies by estimated quantity. In this case it's $12.34 - $11.00 = $1.34 and then $1.34 x 500 = $670.00. (See below for more detailed information regarding sales data and distributors.) Scenario 4: Deviated Percent. In this scenario the contract has a 10.00% rebate set up. Since the product has a Default Price of $42.00 the rebate would be 42.00 x 10% = $4.20. $4.20 x 500 estimated cases = $2100.00 in Probable Exposure. (See below for more detailed information regarding sales data and distributors.) Scenario 5: Growth Program. Please see below for a more defined explanation of how Growth works with Probable Exposure.
Scenario 5: Helps explain how Growth and Probable Exposure work together.
Probable Exposure and Stacked Data
The probable exposure displays on the Exposure Tab of a contract.
To Generate Exposure for a contract, click the Generate button.
Summary
Displays the Exposure, Actuals and Remaining Amounts.
Exposure: This section breaks out the contract exposure by product direct, product deviated, and lumpsum spend. The contract’s total probable exposure is summed at the bottom of that section.
Actuals: This section breaks out the actual amount paid on this contract version by product direct, product deviated, lumpsum and overflow amounts. The Product Overflow and Lumpsum Overflow amounts are what was paid on this contract to products and/or lumpsums which are not on the contract. Examples are Ineligible Sku or Ineligible Event. The Contract Actuals amount is the sum for items paid which are on the contract only. The Contract Total Actuals is the sum of all amounts paid on this contract version.
Remaining: This section displays the remaining amount as the exposure amount minus the actual amount for the products on the contract version. The total amount remaining is summed at the bottom of that section – this amount excludes the total for amounts paid which are not contract products/lumpsum.
Note that there are several different tabs with the Exposure tab:
Direct Exposure
This tab displays the estimated spend for the current contract version as well as stacked reporting information for other contracts where there are overlapping timeframes for the contractee.
Company Name and Company Number: displays the company name and number of the contractee. If the contractee is a company grouping, each of the companies which are a part of that grouping will display.
Product Name and Product Number: displays the product name and number for products listed on the contract as well as other products listed on other contracts for the contractee and timeframe. If the product is on the contract as a product grouping, each of the products in that grouping will display.
UOM Description: displays the UOM for the product row.
This Contract Direct Rate: the direct rate per product. Note that this field will convert all amounts to a rate even if the product is defined as fixed price or a percent. If the company is a distributor and the product is priced as a percent or fixed price, the rate displayed will be based on either default price, sales data or price by company/product as defined in order in the client settings for the manufacturer.
This Contract Estimated Quantity: the estimated quantity per product.
Estimated Quantity for Product Grouping: If a product is on the contract at the product grouping level, the estimated volume will display as the value entered on the contract divided by the count of products in the grouping. For example, if the product grouping had an estimated volume of 100 and there were 4 products in the grouping, an estimated volume value of 25 would display on each product row.
Estimated Quantity for Company Grouping: If the contractee is a company grouping, the estimated volume will display as the value entered on the contract divided by the count of companies in the grouping.
Estimated Quantity for Both Product Grouping and Company Grouping: If the contractee is a company grouping and there are product groupings on the contract. The estimated volume will display as the value entered on the contract divided by the count of companies in the grouping and divided by the count of products in the grouping.
This Contract Estimated Spend: the estimated spend for the product. Formula is Direct Rate * Estimated Quantity.
Other Contract(s) Direct Rate: displays a sum of all rates for other contracts for the same contractee, timeframe and product. Note that this field will convert all amounts to a rate even if the product is defined as fixed price or a percent. Clicking the hyperlink will open a popup which displays the other contract version information for that product row.
Total Stacked Direct Rate: sum of This Contract Direct Rate plus Other Contract(s) Direct Rate for the product row.
Total Stacked Estimated Spend: formula of This Contract Estimated Quantity * Total Stacked Direct Rate. This value represents how much could be paid out to this contractee for this timeframe over many different contracts.
Total Claim Amount: displays a sum of dollars on how much has been paid out to the sku for this contract version. Clicking the hyperlink will open a popup with the claim information.
