Unit cost is the amount that you, as the retailer, pay to the vendor to purchase one unit of a product. This differs from the price, the amount that customers pay to purchase the product from you. This can be thought of as the selling price. Meanwhile, MSRP, short for “manufacturer suggested retail price”, is the amount a manufacturer recommends that retailers sell an item for when it is first released on the market. Generally, unit cost should be lower than the price; price may be lower than or equal to MSRP.
Where is unit cost stored?
Unit cost is stored at the lot level. You can view the unit cost for lots through the PIM. Open the corresponding product family, select the corresponding SKU, and press the [Inv Lots] button. This opens the Lot Detail window displaying the unit cost associated with each lot ID.
Note that it is possible for two different lots linked with the same exact SKU to have two different unit costs. This may occur in cases when an item is bought earlier at one cost and then bought again months later at a discount because it is out-of-season or the vendor has overstocked.
How is unit cost used?
Unit cost is important for reporting purposes. It’s needed to measure KPIs, including profitability, your cost of goods on hand, and your cost of goods sold.
How is unit cost recorded?
Unit cost is typically recorded while adding items to the PO. Unit costs are set by your vendors though your buyers may negotiate for lower costs at times. Buyers enter a unit cost for each line item on the PO. When products are received against the PO, the lot created will be given the unit cost for the line item being received against.
Items on Bulkstock POs present a special case. All items will initially be associated with one unit cost. These unit costs must be modified later after the items have already been received into ROP. This can be done by importing a Lot Cost Update using the Data Import Tool.
How can I edit unit cost?
To edit unit costs, you must view them through the PIM. Open the corresponding product family, select the corresponding SKU, and press the [Inv Lots] button. This opens the Lot Detail window displaying the unit cost linked with each lot ID. You can edit unit costs in this window by clicking directly on the value.
You can also edit unit costs in bulk by importing a Lot Cost Update using the Data Import Tool. This method is required for items on bulkstock POs. Refer to the article, “Update Data in Bulk Files”, for more info.
Do you keep historical data on unit cost updates?
No, we do not keep historical data on unit cost updates. When the unit cost is updated, the original cost is overwritten.