Like most manufacturers in the UK, many of my customers source and import products from suppliers around the globe. This creates a requirement for accurate costing including freight and shipping charges, to ensure visibility and protection of the profit margins.
Whilst this may be stating the obvious, I have seen over the years, too many businesses using various off-system processes and methods to include (or quite often not include) the associated shipping and duty charges as part of the cost of goods received.
As the information isn’t stored centrally the figures aren’t easily accessible and the result is often that the business doesn’t truly understand the cost, and critically the margin, for each product they sell. This can lead to costly mistakes when making both procurement and product range decisions.
However, this need not apply to users of SYSPRO. A simple solution to answer the challenge of applying freight and shipping charges from multiple suppliers exists within the Landed Cost Tracking module of SYSRPO. Unfortunately not enough of my customers use this module.
Forming part of the purchasing suite of modules in SYSPRO and integrating to Accounts Payable, Inventory, General Ledger and MRP, the functionality includes the ability to apportion user defined cost elements across multiple suppliers to a shipment of goods by relative volume, mass, quantity, value, user-defined calculation or purely through manual entry. The shipment being a user-defined entity which may comprise multiple lines from different purchase orders.
SYSPRO’s Landed Cost Tracking includes the ability to calculate expected costs and to perform cost changes to products as well as providing rich reporting on variances of actual to expected costs by shipment. The ability to hold multiple routes allows for comparison of costs between alternate methods of shipment.
The receiving of a shipment of goods with associated freight, shipping and duty costs creates GRN accrual entries for each of the cost elements from each of the suppliers allowing for the normal matching against Supplier invoices.
Ultimately the module enables the business to make better use of management information to make informed strategic decisions about which products to sell and about how to source.
