PI (Price Index)
The Price Index (PI) is a metric used in procurement to measure and monitor the relative price performance of the items being purchased. It estimates the change in price for a specific item or set of items over time. This index serves as a barometer that can be used to identify market trends, compare vendor prices, and predict future purchasing costs. By analyzing fluctuations in market prices in the context of the PI, organizations can better understand and manage their procurement-related costs.