Inventory Cost Report

Efficiently managing your business's profitability is no small feat. While you meticulously track marketing costs, Shopify fees and other expenses, it's crucial not to overlook a pivotal element – inventory costs. Neglecting this aspect can throw your profitability off balance, impacting the overall financial health of your ecommerce store.Report Pundit’s Inventory Cost Report acts as a financial compass, ensuring your business stays on course by delivering accurate insights into inventory costs. It goes beyond mere calculations and offers valuable information for strategic pricing decisions. By incorporating factors such as competitor pricing and total inventory value, the Inventory Cost Report empowers merchants to fine-tune their pricing strategies for optimal results.Note: Report Pundit considers Inventory Cost as the total amount you’ve spent on acquiring the products you’re selling. The formula is:Inventory Cost = Total number of units purchased * Price per unit

How to Calculate Inventory Cost

Let’s say William, owner of a Shopify electronics store, buys 10 TV sets at a standard wholesale price of $250 each.So, his Inventory Cost is: 10*$250 = $2500Now let’s consider this second scenario: William buys 100 TV sets, and so his supplier offers an additional 10% bulk discount on the wholesale price.The inventory cost this time is:Cost of TV Set$250No. of Units Bought100Inventory/Product Cost$2500010% Discount-$2500Inventory Cost after Discount$22,500Inventory Cost per Unit$225The inventory cost per unit is the total inventory cost divided by the number of units. In William’s case, it’s ($22500/100) = $225.

Why You Must Track Inventory Cost

With an accurate inventory cost, you can:

• Optimize your product pricing strategy for maximized profits
• Account for covered expenses
• Anticipate market fluctuations and make pricing decisions based on demand

Data Fields in the Inventory Cost Report

The standard fields in this report are:

• Product Title: displays name of the product
• Variant Title: shows variant name of the product
• SKU: the unique stock keeping unit code of a variant
• Product Price: the listed price of the product
• Inventory Cost: total product cost for available units in inventory. Calculated as Product Cost * Inventory
• Inventory Value: total value of the product inventory based on sale price i.e. Inventory * Product Price
• Location: location where the inventory is stored
• Collections: the product/variant’s collection
• Product Status: confirms if a product is ready for sale. Status options are Active (ready to sell), Draft (details need completion), or Archived (no longer for sale)

How to Open the Inventory Cost Report

It’s a simple 3-step process:

1. Click on Library in the app’s navigation bar.
2. Look through the Sales & Order Reports section.
3. Once found, click Inventory Cost Report.

Quick Tip: You can search “Inventory Cost” in the library page’s search bar to quickly bring up the report.

Frequently Asked Questions

• Why do I need the Inventory Cost Report?

Report Pundit’s Inventory Cost report shows the amount you paid for each product in your inventory, along with other relevant info. You gain the insights you need to price your product right, optimize wholesale purchasing costs, calculate accurate net profits, and more.

• What is the purpose of the Inventory Cost Report?

Report Pundit’s Inventory Cost report helps you:

• Track inventory costs for accurate budgeting
• Support accounting and audit compliance
• Understand key data to calculate profits correctly
• Determine effective retail prices inclusive of business expenses, like competitor pricing

• Where can I run the Inventory Cost Report in Report Pundit?

You can run the report by entering the Report Pundit App -> Library -> Inventory Reports -> Inventory Cost.