Average net price
What you actually received per unit, after every discount, rebate and allowance.
01 What it is
Why anyone looks at this number
What you actually received per unit, after every discount, rebate and allowance.
It is one half of revenue, and the half that falls almost entirely to profit. Reporting revenue without it means nobody can tell a pricing win from a volume push.
02 The formula
How it is worked out
Average net price = net_revenue ÷ units grain : month × product × customer unit : currency per unit source : ERP billing
It is a ratio, so it must never be stored as a column. Two reports that each store their own average price will disagree within a quarter, and both will be defensible.
03 Worked example
The same number, with real inputs
| Net revenue | €50.0m |
| Units | 4.00m |
| Calculation | 50.0m ÷ 4.00m |
| Result | €12.50 |
Up from €12.00 last year. On last year's 3.8m units that 50 cent rise is €1.9m of pure profit — more than the €0.86m the extra volume delivered.
04 What moves it
Four things that actually change this number
List price changes
The deliberate part, and usually the smallest.
Discount and rebate leakage
The part nobody planned, spread across thousands of invoice lines.
Mix
Selling more premium lines raises the average with no price change at all.
Currency
Translation moves it for foreign sales without anyone renegotiating anything.
05 Where the number lives
The system, the record and the fields
| System of record | Key record | Fields you need |
|---|---|---|
| ERP billing | Invoice line | net_amount, billed_qty, currency, credit_note_flag |
It is a ratio, so it must never be stored as a column. Two reports that each store their own average price will disagree within a quarter, and both will be defensible.
06 How it goes wrong
Three ways this metric misleads people
Reading it as a pricing result
It moves whenever mix moves, so a shift to premium products looks like a pricing win.
Fix: Always report price, volume and mix as three separate effects.Averaging across currencies
A single group average blends exchange rates and product families into a meaningless number.
Fix: Report in constant currency, at product level.Excluding credit notes
Returns and credits reduce revenue but often get filtered out of the price calculation.
Fix: Use one governed net revenue definition for numerator and denominator alike.08 Questions
Frequently asked
Why should average price be a ratio and not a column?
Because the right answer depends on the level you ask at. Stored as a column it can only be averaged, and averaging an average gives the wrong number as soon as volumes differ.
How do I separate price from mix?
Hold volumes at last year's weights to measure price, hold prices at last year's level to measure volume, and treat what is left as mix. That way the three parts always add to the total.
One definition, everywhere it is used
SCIKIQ stores this metric once and serves it to every dashboard, board pack and agent that asks.