What is the difference between CPN and MPN Cost? Follow

MPN Cost

MPN Cost is the cost a buyer is charged for a part. This is the price that your organization has loaded on the platform for the time period listed at the unique (MPN + CM/ODM) level.

MPN Cost is one of the most commonly displayed statistics in the platform, and is visible in the Spend Awareness View Detail table where you can see (for example) 1 CPN with 3 MPNs with 3 CM/ODMs and the 9 associated unique costs:

CPN Cost

CPN Cost is the weighted MPN Cost based on splits and allocation. The LevaData Platform has the ability to calculate and aggregate costs across multiple quarters in which case splits are factored into CPN Cost and demand is factored into CPN Spend.

CPN Cost for a Single CM/ODM

CPN Cost for a single CM/ODM is calculated as:

$$\sum\frac{\text{MPN Cost} * \text{Split}}{100}$$

This is a weighted average of all MPN costs that comprise the CPN+CM/ODM for your organization based on your actual and split data for each part.

For example, when looking at a specific CPN (Mechanicals 2) in Cost Detail, we can see that it has a specific CPN Cost of $16.504854 in 2024'Q1.

We can see in the Master Cost Table Detail View that Mechanical 2 is made up of two MPNs with a 50/50 split and two costs.

Here is how we would calculate the two MPN Costs into the one CPN Cost

$$\frac{{(\text{MPN Cost 1} * \text{Split % 1}) + (\text{MPN Cost 2} * \text{Split % 2})}}{{100}}$$

Here is how this example has been calculated:

$$\frac{{(17.581707 * 50) + (15.428 * 50)}}{{100}} = 16.504854$$

CPN Cost for Multiple CM/ODMs

CPN Cost for a multiple CM/ODMs is calculated as:

$$\sum\frac{\text{MPN Cost} * \text{Split}}{\text{CM Count} * 100}$$

And the CM CPN Cost for an individual CM/ODM is then the same as the original CPN Cost:

$$\sum\frac{\text{MPN Cost} * \text{Split}}{100}$$

Example of CPN Cost across Multiple CM/ODMs and Multiple MPNs

Let's use an illustrative example to demonstrate how CPN Costs can be rolled up across multiple MPNs and multiple CM/ODMs. Consider the following example:

• CPN A is spread across CM/ODM 1 and CM/ODM 2.
• CM/ODM 1 has four MPNs, two of which (MPN 1 and MPN 4) are also shared across CM/ODM 2.
• Total MPN Cost (seen in Spend Awareness: View Detail Table) is the Median of MPN Costs across all four quarters.
• CPN Cost for 2023'Q4 is the Baseline CPN Cost, used to calculate Savings against each 2024 Quarter Cost.
• Let's isolate 2024'Q1 and illustrate three specific calculations.

Example 1: CPN Cost

Using the formula for CPN Cost across multiple CM/ODMs:

$$\sum\frac{\text{MPN Cost} * \text{Split}}{\text{CM Count} * 100}$$

With the values in the table:

Gives us the following output:

$$\frac{{(14.4983 * 25) + (11.5242 * 25) + (12.9710 * 25) + (13.7550 * 25) + (15.7650 * 80) + (16.0030 * 20)}}{(2 * 100)} = 14.4999$$

Example 2: CM CPN Cost

Using the formula for CPN Cost across a single CM/ODM:

$$\sum\frac{\text{MPN Cost} * \text{Split}}{100}$$

With the values in the table for only CM/ODM 2:

Gives us the following output:

$$\frac{{(15.7650 * 80) + (16.0030 * 20)}}{(100)} = 15.8126$$

Example 3: CPN Spend

Use the formula for CPN Spend with the previously calculated CPN Cost.

$$\text{CPN Cost} * \text{CPN Demand} = \text{CPN Spend}$$

With the values in the table:

Gives us the following output:

$$\text{14.4999} * \text{698,038} = \text{10,121,451}$$

Global Pricing

MPN Costs by CM/ODM can be modified using the Global Pricing Flag which decides whether MPN Cost vary by CM/ODM and is configurable by request from your organization to our customer data quality team. The LevaData Platform sorts this information by Global / Site Level for Spend and Savings Details.

Global Level Pricing

If the CPN Global Price is set to Yes, then all sourcing information (e.g. MPN Cost, MPN, Manufacturer, Supplier, Split, etc.) will remain the same across all CM/ODMs within the CPN + Quarter.

• Forecast gets aggregated at the CPN level.
• Supplier(s) need to provide the cost at MPN level, which doesn’t vary by CM/ODM.
• Split allocation will be 100% at the unique (CPN + CM/ODM + Fiscal Quarter) level.
  • These splits will not change by CM/ODM within a CPN
• This is displayed as CPN Cost (Global Level) and the CPN cost is calculated across all the CM/ODMs so that your CPN cost will remain the same across all CM/ODMs.

Site Level Pricing

If CPN Global Price is set to No, then MPN costs vary by CM/ODM.

• Forecast gets aggregated at (CPN + CM/ODM) level.
• Supplier(s) needs to provide the cost at (MPN + CM/ODM) level, which varies by CM/ODM
• Split allocation will be 100% at the unique (CPN + CM/ODM) level.
• This is displayed as CM CPN Cost (Site Level) and the CPN cost is calculated by CM/ODM so that your CPN cost may change for each CM/ODM.