The PIR report uses Cost of Goods in its reporting without having to rely on inventory values!
SMS is designed with a one database concept. The same database that lives in the back office is the same database on the lanes. As this is the case when the cost is updated in the back office then the cost is updated on the register. This gives you the cost of the product when the sale is made. As with the retail now we have the cost of product at the time of sale.
In the older programs the cost was not available at the lanes so it was a problem calculating the gross profit on items. Inventory was the only true way of capturing the cost of goods. For this one had to wait until the end of period before a gross profit could be calculated.
Using LOC’s new cost of goods, and getting the cost at the time of sale opens a whole new arena on reporting store wide as well as item level detail. With this new feature we can report on profitability from lots of different groups (total, department, sub department, category, report codes) in real time. We spot problems in the gross without having to wait until the end of the period. Run the report each day if you want. It will give you accurate gross metrics.
The beauty of this system is that you no longer have the overhead of sustaining a periodic inventory. We all know that perpetual inventory in a grocery store is challenging if not impossible. If every item had a one to one ratio then inventory would be easy. However in reality, we do lots of product transformations in the grocery world from meat to produce and deli. This will require tremendous effort and monies just to keep the inventory accurate. If it gets off just a little then we have lost confidence in our numbers and the reporting is useless.
Cost of Goods reporting relieves you from the challenge of perpetual inventory. All you have to do is verify that the item costs are good and your reporting is good. No inventory cycle counts, no forever adjusting your inventory just to get the reporting correct.
Imagine being able to run your gross profit reports and know the data is accurate. If you would like this feature then the Performance Indicator Report is the report for you!
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