Understand and manage product costs

Product costs are held per base stock unit, such as one g, one ml or one each, in the business currency. A Supplier Product price is normally the net price of one purchase unit, such as a case. Flexitill converts that case into base stock before calculating an ingredient or portion cost. Purchase VAT is separate from the net receipt cost.

Average cost, latest received cost and preferred supplier price are not three independently selectable modes. They are the automatic fallback chain. There is no separate “always use the newest supplier quote” or “always use the latest receipt” option in this control.

“Uses the moving-average received cost, then the latest receipt or preferred supplier price.” means: use the first available cost in this order, and stop looking once one is found.

1. 1Moving-average received cost: use the Product's stored average cost per base unit. This is normally available after a priced receipt has been posted.
2. 2Latest received cost: only if no average exists, use the stored last received cost per base unit. This is a fallback, not an instruction to replace an older average with the latest price.
3. 3Preferred supplier price: only if neither received cost exists, convert the active preferred Supplier Product's net price into cost per base unit. This is an estimate, not evidence of an actual purchase.
4. 4No usable source: show missing or incomplete cost. Fix the source data instead of treating the unknown amount as zero.

When a positive, priced receipt adds stock, Flexitill weights the old average by the quantity remaining immediately before that receipt. It then adds the incoming quantity at its new cost. It does not simply average two invoice prices or give every delivery equal weight.

1. 1You have 2,000 g of flour at CZK 0.04/g: a carried cost of CZK 80.
2. 2A delivery adds 3,000 g costing CZK 180 net: CZK 0.06/g.
3. 3The new average is (80 + 180) ÷ 5,000 = CZK 0.052/g. A 200 g ingredient portion now costs CZK 10.40.
4. 4After consumption leaves 500 g, a further 1,000 g arrives at CZK 0.08/g. The next average is (500 × 0.052 + 1,000 × 0.08) ÷ 1,500 = approximately CZK 0.070667/g. Only the remaining 500 g carries the previous average into this calculation.

If no old average exists, or stock before the receipt is zero or negative, the new average starts at that receipt's cost. Negative prior stock contributes zero weight. Consumption reduces the quantity used in the next calculation; it does not itself calculate a new average. The latest received cost is also stored separately when the receipt is posted.

This is a shared Product cost across the business's inventory balances, including locations, Storage Areas and Variants. Selecting a location or Variant does not give it an independent moving average. FIFO, FEFO and Storage Area priorities choose which physical stock to issue; they are not alternative cost-calculation modes.

Where to find it·Inventory → Products → choose a Product → Supplier products

1. 1Add or edit the Supplier Product for the purchased Product. Check the supplier identity and the purchase unit: one case, one jar or one kg are different price bases.
2. 2Enter Pack cost as the net price for one purchase unit, not for one inner item unless that inner item is what you order.
3. 3Choose a reusable Product pack or configure the supplier conversion. Check the 'Adds … per purchase unit' statement against the usable stock you receive.
4. 4Keep the offering Active and select Preferred for the offering whose price should supply the automatic estimate. The first active offering is selected automatically; with multiple offerings, make the choice explicit.
5. 5Save, return to Cost & margin and refresh the preview. Supplier price is used only when automatic costing has no received basis.

Example: a case of six 400 g tins costs CZK 240 net and adds 2,400 g. The supplier estimate is 240 ÷ 2,400 = CZK 0.10/g; 150 g costs CZK 15. If stock is measured as drained usable contents, use that usable quantity in the conversion, not the packaging's gross weight. Choosing another supplier does not average the two quotes or pick the cheapest automatically.

During receiving, check the actual net price and stock-added quantity before posting. Receipt cost per base unit is the line's net value divided by the base quantity received. A missing receipt price can become a zero cost; do not post zero as a placeholder for an unknown invoice. See Purchasing & Deliveries for the full supplier and receipt workflows.

Where to find it·Inventory → Products → choose a Product → Edit → Costing

1. 1Confirm the Product's stock unit before entering a value. You can also choose costing while creating a purchased Product.
2. 2Select Standard cost. Enter the net amount for exactly one base unit in Standard cost per g, per ml or per each, as labelled.
3. 3For a target cost of CZK 50/kg on a Product stocked in g, enter 0.05 per g. Enter zero only when you deliberately want zero cost, not when the amount is unknown.
4. 4Save the Product, refresh Cost & margin, and expand the breakdown to check the source and a familiar portion quantity.
5. 5When you want receipt-driven costs again, edit Costing, choose Automatic and save. Recheck the preview; an existing received average takes priority over the current supplier quote.

For a directly consumed purchased or prepared Product, a valid standard cost takes priority over received and supplier costs. It is not added on top of them. Receipts still retain their actual costs and update the received-cost fields while Standard is selected, but they do not change the fixed standard you entered. A missing standard is not permission to silently use a supplier price; enter a valid value or choose Automatic.

Active, in-date substitutions can redirect ingredient costing to the substitute and multiply it by the conversion factor. For example, a factor of 1.2 and substitute cost of CZK 0.05 per base unit produces CZK 0.06 for each original base unit required. This does not revalue the original Product's own stock as if it were substitute stock. Product Variants can have separate quantities but still share the parent Product's cost basis; a Variant preview is marked as an estimate.

Global Units, Product packs and density must resolve each ingredient to base stock correctly. See Recipes, Units and conversions for configuration and examples. Recipe material cost does not automatically add labour, preparation time, energy, overheads or transaction charges.

Where to find it·Inventory → Products → choose a Product → Cost & margin

1. 1Save any Product or Supplier Product edits, then refresh Cost & margin. The preview reads saved data.
2. 2Enter Amount consumed per sale. Use a different unit for a compatible measurement or pack, or select a Variant where applicable, then Calculate.
3. 3Expand Cost breakdown. Check the consumed quantity, cost per unit, line total and source: average received cost, last received cost, standard cost, preferred supplier estimate or Recipe estimate.
4. 4Resolve incomplete-cost warnings before relying on a total. If there is no selling price, you can still inspect cost, but profit and margin cannot be calculated.
5. 5Check the actual Menu Item as well. The Product preview uses its fallback selling price once for the selected quantity; increasing the consumed quantity does not multiply that selling price. Menu Items have their own prices and consumption configuration.

Gross profit = selling price excluding VAT − material cost. Gross margin = gross profit ÷ selling price excluding VAT × 100. For a net sale of CZK 100 and cost of CZK 30, profit is CZK 70 and margin is 70%. Margin is not markup and is not final restaurant profit. A zero net selling price has no calculable percentage margin; a loss can show a negative margin.

If you cannot edit the relevant records, ask a manager with Product, Supplier Product or Delivery permissions to make the change. Verify the corrected source and refreshed breakdown before changing menu prices.