Get true margins on commission items with Nominal Cost %
Bus tickets, agency products and other commission-based items are a great way to bring customers through the door, but they have always been tricky to report on. They are sold but never receipted into stock, so Beacon had no cost to work with. That meant these items could show a 100% margin and make your profit reports look better than they really are.
From Beacon version 4.0.3.X, you can give a non-stock item a nominal cost as a percentage of its selling price.
How it works
Say you sell bus tickets and earn a 3% commission. Set the item’s nominal cost to 97%, and Beacon treats 97% of every sale as cost:
A $50.00 ticket has a cost of $48.50
Your margin is $1.50, or 3%, which is what you actually earn
Because the cost is a percentage, it stays correct when the price changes. Update the ticket to $60.00 and the cost moves to $58.20 automatically, with no need to work it out yourself.
Setting it up
In Back Office, open the stock item on the Change Stock screen.
Make sure the item type is set to Non stock.
Check Sell Price 1 is correct. The cost is worked out from this price.
Tick Nominal Cost is a %.
Enter your cost percentage in Nominal Cost (%), for example 97.
Save the item.
Beacon fills in the Nominal cost ($) field for you, and updates it whenever you change the sell price on this screen.
Where you will see the difference
Your Stock Margin and Stock Margin Analysis reports now show a realistic cost and GP% for these items, instead of $0 cost and 100% GP. That gives you a much clearer picture of where your profit really comes from, and stops commission items from inflating your overall margins.
Ready to use it?
Nominal Cost % is available from version 4.0.3.X. If you are on an earlier version, or would like a hand setting up your commission items, contact the Beacon Support team and we will help you get it running.
