Maintaining Consistent Margins with Changes in Cost Price

In MYOB EXO Business, you can maintain your existing selling price margins, even though your cost prices may fluctuate. Fixing your margins means your selling price will vary, so this presupposes that your customers will accept the price changes without prior notification.

You can review the margins and prices of a stock item by:

• using the Price Change window, which is displayed when an inwards goods receipt varies by more than the margin specified for the stock group, or

• using the Sell Price Formulation window.

The operation of these features is dependent upon two User-level profile settings:

• Check supplier cost prices when purchase prices change - prompts to update the supplier cost price when overriding prices when placing a purchase order (creating or editing a purchase order as opposed to receipting stock).

• Minimum percentage cost variance requiring price review - controls the triggering of the popup by setting a minimum percentage variance in landed cost (local currency), above which the price review popup window will appear.

When goods are receipted and costed, and the cost differs from the previous average cost, a window is displayed for each stock item affected. You can then review and reset the selling price if required.

To reset the selling price for a price name, enter the new price in the New Val column. Enter the new selling price to maintain the margin you require.

Advanced

If you have different staff responsible for costing and setting selling prices, you can add profitability information on the costing sheet. The costing sheet could then be used by someone in Sales/Marketing to review pricing and advise on required changes, as a separate process to inwards good costing.

• The %Margin column presents gross margin, i.e.

  (Sellprice-Cost Price / Sellprice)*100.

• The %margin is a false figure  Price Names that are in foreign currency because the currency exchange is not taken into account here, however the proportional cost variation still applies

• The costing sheet is controlled by the Clarity form IGCosting.CLF.  The availability of this functionality is governed by three User profile settings;

• • Stock Costs Hidden - User profile attempts to prevent users from seeing cost prices while browsing the stock records.

  • Check Prices when Costs Change – Custom level User profile enables the display of the price review pop up window if the cost price of the item has changed on a purchase order or creditor invoices (using stock), prompting the operator to reset the sell prices in order to maintain the same percent margin.

  • Cost change check threshold - Custom user profile sets the minimum percentage variance in landed cost (local currency) required to activate price review popup window.