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Revenue and GP on the Stock Usage Comparison Report

By Daisy Lang |

A little while ago we introduced the ability the exclude certain ingredient categories from your GP calculations. This, combined with an ability to exclude certain lead types from having revenue attributed to them, gives you more control than ever over how you see your sales and profits reported on the Stock Usage Comparison Report. However, this has the potential to require some fairly complex calculations and because these figures are critical to your business, we felt them worth unpacking in more detail.

On the Stock Usage Comparison Report, we give you headline actual and theoretical GP figures. Actual is based on physical stock usage as defined by stock checks, theory is based on expected stock usage from your sales.  These figures then get broken down into the various components that have contributed to them.

The PLUs you sell have recipes made up of ingredients, all ingredients sit within a category and all ingredient categories fall under a lead type – most often Food, Wet or Controllables. When you sell a PLU, we assess the sale price and recipe make up to proportionally attribute the sales revenue to each ingredient. This then gets reported at ingredient level, by ingredient category and finally by lead type.

If you choose to define a lead type as not included in this process, then the revenue its ingredients would normally be attributed gets split equally between the other ingredients in the recipe. A use case for this might be to sell a burrito whose recipe includes the food ingredients required to make the product and also the relevant packaging ingredients, e.g. foil wrap, napkin, bag. You’d want the packaging to be in the recipe so the stock usage gets accounted for, but you might not want it being seen to generate revenue when the item is sold.

In this scenario, provided you’d stock checked the packaging category, you’d see zero revenue alongside the Controllables lead type (in which the category sits) on the Stock Usage Comparison Report. All the revenue generated by sales of this item would be attributed to the ingredients in the Food lead type. However, you would still see the cost of the Controllables stock usage, in actual and theoretical terms. The cost of the Controllables stock used also gets factored into your overall GP figures for the period, as they are a cost associated with your sales.

Sometimes you may hold stock that never gets sold to your customers, such as cleaning supplies. The cost of using stock of this type is therefore not associated with sales and is less appropriate to include in GP calculations. In this scenario, you’d mark the relevant ingredient category as excluded from GP calculations, and as a result you get a slightly different view of these categories on the Stock Usage Comparison Report.

For categories excluded from GP calculations, we don’t display any attributed revenue, theory usage or figures relating to theory versus actual. For this reason, if you have ingredients included in recipes, their categories cannot be excluded in this way.

 

About Daisy Lang

Detail obsessed product nerd, wonderfully stuck between customers and tech. Unable to resist margaritas or ice cream.