What is it doing?
The COGS and Gross Profits report combines your purchasing, counts, and sales data to identify you cost of goods sold (COGS) and gross profit.
To run this report you'll need:
- All orders received (or invoices scanned)
- 2 Inventory counts will provide an accurate report, but you can run the report even without counts.
- Sales summaries (via POS or manual upload)
- To use the report in-depth, you should also have categories for inventory items and in your POS
Note: This report is only live for specific POS partners. If you do not see this yet, please email your account manager or email@example.com to learn when it will be available for you!
Why should I use it?
This report gives you the easiest and most accurate glimpse into your inventory and profit margins while helping identify problematic items and categories.
Setting it up
1. Click on the gear icon at the top right corner
2. There are three types of categories that make up your COGS report
Inventory categories: These are the categories created in MarketMan to help organize your items.
example: liquor, dairy, veggies
POS Categories: These come directly from your point-of-sale system
example: beverages, apps, salads
MarketMan Categories: Here is where we map inventory categories to the sales from your POS categories. By clicking Add new create 3-5 high-level MarketMan Categories.
we recommend: Food, Beverages, Non-Alcoholic. (keep these categories simple, we can drill down into more detail once the report is built!)
4. Select a category from the sides and drag it to its relevant part in the middle. For example, if you want to see your Beer COGs, you would create a Beer MarketMan category, and then drag in any relevant inventory and POS categories.
5. Exclude Categories: You also have the ability to exclude categories from the COGS report. Remove paper goods, cleaning supplies, etc that you don't wish to calculate in your total cost of goods sold.
5. Don't forget to hit "Save"!
HOW TO - Step by StepThere are now two different ways to look at the COGS report:
1. By selecting two inventory counts to define the range of time you are looking at the report. This gives you an Actual COGs (opening inventory + purchases - closing inventory compared to sales).
2. To select two dates regardless of whether or not you have counts for those dates. This allows you to see your COGS even if you have not taken counts in MarketMan! This gives you an Estimated COGS (only comparing your purchases to your sales).
- Go to Reports > COGS and Gross Profits, and select your inventory counts.
You will see a guide at the bottom that explains green dates are valid counts to use as your start date, while blue dates are valid counts to use as your end date. Based on that guide, choose the counts and range of time you are looking to view the report!
Note: It's important to choose days will full inventory counts. if items are missing from the count, cogs will only be an estimated number.
- After selecting your counts you will be able to see if any of the items have not been counted on the inventory count dates that you chose.
- The graph on the left shows your overall COGS/Gross Profits.
The bar chart on the right breaks down your COGs for the different categories you created with the gear icon.
- By clicking on the category you can expand the information and graphs shown!
- The last section shows your COGs for every single inventory item!
Here's how we calculate the COGs:
If an item is missing one or more inventory counts, MarketMan will use the purchase QTY as the COGs suggestion- this is not 100% accurate, which is why you should always try to look at reports between counts.
- You can always check out more information about the item by hovering over the item and clicking on the calculator icon. That will bring up a logbook of the item.
This logbook will show the calculations and sources behind the opening inventory, purchases, transfers, closing inventory, and actual usage/COGS. Clicking on the source will open it in a new tab.
Check out an explanation of each below:
a. Opening inventory = shows the opening inventory count x the value to get the inventory value.
b. Purchases will show the purchase quantity x the average price to get the purchase value.
c. Transfers will show any transfers between branches of this item. This is only available if you are a multi-location.
d. Closing Inventory describes the closing inventory count x the value to get the closing inventory value.
e. Actual usage and COGS shows the formula we use to get COGS which is
Opening inventory + Purchases + Transfers - Closing inventory = COGs.
Cost of Goods Sold over time - COGS overtime dashboard card
The COGS Over Time dashboard card allows you to compare your cost of goods for different time periods. See how this month cost stack up against last month and pinpoint where you can save!
Extra tips - from the experts!
On the items level (bottom of the report)
- You can click on column headers to sort/resort
- The ? mark next to each column header tells you what's calculated into that column
- You can export all of this information by clicking the graph button top right of the screen
- You can use the search box to view only one category / specific item
If you are a multi-location we highly recommend
- Ensuring locations take period counts at the same time
- IE count the same day each week or the same day each month
- Checking the Gear icon weekly to allocate all categories
Want to dive deeper? Don't forget to download the COGs into excel as well to further analyze!