Getting Ready to use Order and Item Profitability
Unify Desktop can automatically calculate order profitability for all of your orders to provide insights on your best sellers in terms of quantity, revenue and profit margin.
The only thing you need to do is make sure you are recording cost accurately for your products in QuickBooks. In the below screenshot you can see this active QuickBooks file has had inventory received and cost recorded for all of my inventory assets.
Your cost can be manually adjusted in QuickBooks en mass by using the Lists >> Add Edit Multiple List Entries option, or can be received over time when importing item receipts.
Sync your Orders to QuickBooks
A profitability report for an order is made up of two parts: the cost of the item or services being rendered and any other additional cost to you like merchant processor fees, and the price it was purchased at by your customer.
Upon posting orders received from your online store to QuickBooks, Unify commits inventory (out) and revenue (in) to QuickBooks. When a sale has been posted to QuickBooks, all pieces of profitability are now in place to display the report for that order -- The cost you already received, any additional cost or fees from the order details, and the price your customer paid you for their order. Below you can see orders that have been posted to QuickBooks and the associated profitability report. This report is found by going to the top navigation menu to Orders >> Order Profitability report.
The above report can be filtered by date, and whether the orders have been posted to QuickBooks or not. *NOTE* As previously mentioned, if an order has not been posted to QuickBooks it will not show it's profitability yet.
Reading the Profitability Report
As you can see in the previous screenshot there is a lot of information displayed by this report. Depending on the date range and the QuickBooks status of orders you have sorted by, summary information will display at the top of the report:
Total Orders: Number of orders in the selected range (Date and Posted or Unposted status)
Total Revenue: Raw revenue from the order details. Includes 100% of the price paid by the customer (provided by the order details from your online store)
Total Cost: Aggregate cost of the Item Cost (retrieved from QuickBooks), and any other fees displayed on this report (Payment, Tax etc.)
Total Tax Collect: Tax collected from the order details. **NOTE** This tax is a direct result of your online store's tax settings and displayed tax to customers. If this tax is not being charged correctly, it's a change you'll make on your individual online store.
Total Tax Deducted: Tax as recorded in QuickBooks after the order has posted. In a scenario where your online store is charging a slightly different tax rate than the associated tax rate in QuickBooks for that tax jurisdiction, QuickBooks will post the tax as per it's rates and Unify will display the difference in this report. Tax Deducted is used in the Profit and Loss calculation, while tax collected is displayed to simply show you that your store is not charging the same rate as QuickBooks, allowing you to make any necessary changes to the tax displayed to your customers on your online sales channel.
Total Payment Processor Fees: If you use a payment processor like Shopify Payments, Stripe or PayPal on your online store to allow customers to check out, they can be connected to Unify. The fees associated with each order are downloaded and can be posted as an expense line item on the transaction. They also display as a cost of the transaction when calculating the P&L
Profit/Loss: Total calculated profit and loss for the selected range of orders. Total Revenue - Total Cost (Defined as Tax Deducted + Payment Processor Fees + Product Cost from QB)
This entire report, however you filter it, can be exported and manipulated in Excel for further analysis.
The Order Profitability report in Unify Desktop is best used as a spot check for order profitability in a real-time environment. On a daily basis you can see not only what is selling, but what is selling best in Unify. This profitability report does not include fully landed costs including product inbound shipping fees, tariffs, or other costs you may be booking manually in QuickBooks. For businesses with extra landed costs, QuickBooks reports for Profit and Loss will include those other costs.
Trending Product Sales
In addition to order profitability, Unify Desktop will show a rolling display of your top selling products. By going to your Products >> My Products menu and clicking Get Products at any time, you will see a current report of both your Best Selling Products per channel by Quantity and by Revenue.
Top 10 Products by Quantity
Top 10 Products by Revenue
As with the order profitability report, these at-a-glance views into your trending products on a weekly, monthly and yearly basis can provide actionable insights to your business.