Help on P&L What-If Optimizer

Sai_Bharadwaj_Venati
Sai_Bharadwaj_Venati
in Modeling

Hi Everyone,

I'm trying to build a Simple Optimizer for P&L where Variables are Volume, Selling Price, Cost Price and Objective is to get a Particular Net Income. I'm getting errors and unable to move forward

image.png
image.png
image.png
image.png

V.Sai Bharadwaj

Connect on LinkedIn

Tagged:

Answers

  • KirillKuznetsov
    KirillKuznetsov

    @Sai_Bharadwaj_Venati

    Let me give you some hints how to understand Optimizer:

    In Revenue and Cost you are using a non-linear function. It means that both multipliers are variables. Optimizer works with the multiplication of one variable to any line item which does not lead to another variable. So if you have two variables (A and B) you can multiply them neither directly (A*B) nor indirectly (A*x, where x = B). You can use only A+B. A-B is also ok, because it is A + (-1)*B.

    This means you should start from a simpler case where Salling Price and Cost Price are constants (not included in variables of the optimizer). (SP cons/CP cons should be removed from optimizer settings too)

    Net Income objective should be Maximize otherwise the values will stay zero (now it is Minimize)

    Obj cons and Obj Input are not very obvious. Could you explain what you are trying to check with it?

Categories