Purchase Price Variance

What is PPV analysis

pic4

PPV is a tool to analyze the variance between settled and actual paid price. You settle a price, but is your supplier getting paid at the same price and not more. Also due to business urgencies, you have to accept price increases in hurry. A monthly PPV analysis may help you, identify the error of prices approved viz-a-viz in ERP system, monitor variance w.r.t budgeted figures and initiate corrective actions to bring the Savings to the track again. As the approver, may not have the time to get involved in ERP entries & daily shores, this report will help identify & correct unintentional or intentional mistakes.

Methodology of PPV Analysis

pic5

Benefits of PPV Analysis

pic5