Check out this comprehensive tour on calculating and tracking item cost in Sellercloud’s Alpha interface.
Basics of item cost
You can configure an item’s cost to calculate profit and loss (P&L) on an order with one of these options in the Client Settings’ Order Profit & Loss Calculated Using setting:
- Last Cost— Cost of the items in the last purchase order received before the order was created.
- Site Cost— The current value entered in the product summary’s Site Cost field.
- Average Cost— Cost of the units continually averaged from the price on POs at the time of receipt. If you choose Average Cost but Average Cost is zero, Site Cost will be used on the order’s P&L tab instead.
Item cost and dropship POs
Dropship POs will update the order’s item cost to the vendor’s price on the PO, even though the PO is created after the order.
Dropshipped POs that are set to not count inventory either at the PO or Vendor level (setting on Dropship Preferences on vendor toolbox Default = True) will not create an inventory movement or average cost movement record. This means they will not be factored into average cost.
Factoring PO shipping or third-party costs into item cost
PO shipping and third-party costs can be averaged into an item’s cost to give an accurate P&L report.
Example: If a product costs $50.00 and shipping costs $5.00, average cost on the product’s Purchasing page (Product > Toolbox > Purchasing) will be $55.00. If you ordered 2 units with a total PO shipping cost of $5.00, average cost will be divided between the units ordered, producing an average cost of $52.50.
- Product cost(x) + Shipping cost / Number of units
To use this feature, select Consider PO Extra Costs when Calculating Product Costs in the Client Settings.
