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PPV, also known as purchase price variance, is a term used in procurement to refer to the difference between the market rate of a bought item and its actual price.

Purchase Price Variance (PPV) is a key performance indicator (KPI) that procurement specialists and finance professionals use to monitor cost efficiency in purchasing activities.

A positive PPV means the goods cost more than you estimated, and the cost of goods has increased. A negative PPV means the goods cost less than your estimate, and the business saved money.

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