1. Home
  2. Point-Of-Sale Software
  3. Variable item costs - possible?

Variable item costs - possible?

Hello. Our business (jewelry) has many items whose costs fluctuate based on current exchange rates...also our discount rates with some of our suppliers can vary based on different currency rates as well. Is there any work around, offset, best practice or method that anyone can think of or is using to deal with this situation with respect to configuring item prices?

Best Regards,

Reply to
hitman
Loading thread data ...

finally a question i can help answer! (hopefully :-)

I'm pretty sure what you need to do is start using a "Weighted Average". RMS has this feature where the cost of an item is averaged over time depending on its historical costs in Purchase Orders--so, to use the Weighted Average you have to use Purchase Orders to enter incoming inventory. If you already do this then you're halfway there.

The first thing to understand is that there are 3 different costs for any item in RMS:

  1. The normal cost found in the General tab of the item--note: this will soon be the Weighted Average Cost.
  2. The supplier cost found in the Supplier tab of an item or in the Suppliers menu
  3. The Purchase Order cost, found when creating PO's, representing the actual cost at the time of purchase.

So, let's say you normally buy 100 sodas at $1.00/each per order ($100 total)--You've done this for the past 3 months so you've bought 300 sodas at $1/each. The average cost of a soda is a buck. Then, as a promotion, your top vendor sells you 200 sodas at a discount price of $0.80. So, what's the average cost of a soda now that 300 were bought for a buck and 200 for 80 cents?--the Weighted Average:

(300*1.0 + 200*0.80)/(300+200) = 0.92 cents. (i hope this math is correct! i haven't really attempted this since gradeschool)

RMS will calculate and store the weighted average in the normal cost (#1 above). But first you have to tell it to do so by going here: File>Configuration>Inventory>Cost Update Method>Weighted Average

After selecting this, RMS will recalculate the weighted average cost for items when you bring them in via Purchase Orders or Transfer Ins. When you create a new PO, it usually automatically populates item costs (#3 above) with the Supplier Cost (#2).

You can also configure RMS to update the Supplier cost with the last PO cost here: File>Configuration>Options>Purchase Order options>Update supplier cost and tax rate from Purchase Order

It was kind of confusing the first time i learned of this 3 cost thing--so i hope i explained it well and that this in some way addresses your issue.

cheers, kamal

Reply to
Kamal Hood

Kamal --

Good stuff, thanks alot for your response...much appreciated!

"Kamal Hood" wrote:

Reply to
hitman
80 > cents?--the Weighted Average: >

begin 666 p.gif M1TE&.#EAH0`1`( ````3S/___R'Y! $```$`+ ````"A`!$```+_C(^IR^T/ MHYRTVHNSWKS[#X9B!I0.D*"(JJBL]"[ES,54;#_Y>>P!GF*X*C[#JSA:!9._ M)>UGZCFC-%34>+4VH;9CTY6%8J7;K_BL-&)96JYZ+0VWR$ E^TU];Z_ENCJ/ M!X:G9R581M@WEC@4. AW=\@UT[:'Z+0D,VE9:

Reply to
Elizabeth

You can create a script that utilizes:

  1. a base price, ( the price the piece cost at say 0 gold)
  2. an increment (how much to adjust up/down each dollar the gold is above/below the base gold price
  3. The base gold price (or platinum or silver) price i.e. 0 gold.

To change your sell price simply run the function, enter the current gold, when prompted and the system will sweep through all item and adjust the price up or down. We routinely do this in our wholesale jewelry application and are planning to do this in the next release of MPI-Jeweler, our add-on for RMS.

Hope this helps

"hitman" wrote:

Reply to
RGKayempisystemscom

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.