Updating Inventory Pricing

When was the last time you adjusted your inventory prices? I find that a lot of people don't do this regularly because they still believe that this has to be done manually one part at a time. With ESC that is not the case. ESC allows you to update all your prices, any time you want, with the click of a single button. It can also accurately create retail prices for new parts automatically as you enter them.

Before you can create and update your prices, however, some setup will be required. This setup consists of:

• Creating markup codes
• Assigning them to subcategories
• Assigning them to inventory parts

Markup codes are used to set the price of a part based on its cost. Typically, the cheaper the cost of the item, the greater the markup. As you can see from the code below an item that costs $2.50 will be marked up 400% for the A price while an item that costs $75.00 will only be marked up 225%.

Each markup code can contain 8 cost ranges, although you can setup as many markup codes as you need. They can be created by going to Inventory | Enter Markup Codes.

After you have created markup codes you need to assign them to inventory subcategories. This will automatically calculate the price of a new inventory item based on its cost and the subcategory assigned to it. To assign a markup code to a subcategory go toInventory | Enter Part Categories. Create a new category and subcategories or edit an existing one to see the following screen.

Once there, simply add the markup code to the subcategory and specify whether you want the markup code to be applied to the Average Cost of the item (which is recalculated every time you purchase the part) or Base Price (which is similar to a Manufacturer's Suggested Retail Price and it is NEVER updated automatically in ESC). Do this for every subcategory and you are ready for the next step.

The last bit of setup is to make sure a markup is associated with every part. If you create parts now, the markup code will be automatically assigned by the subcategory in which the part is placed. If you created parts before you did all this setup, you probably have quite a few parts without markup codes. If you find this to be the case just give us a call and we'll provide you with a batch file you can run on the server that will update the markup code for ALL parts based on their subcategory.

Now that the setup is complete, the last thing to do is update the prices. This can be accomplished by going to Inventory | Update Inventory Pricing. From this screen, you can elect to recalculate the prices for a single category or manufacturer or you can leave those fields blank and click Update to get them all. If you have several thousand items this could take a while to run, so we suggest starting this right before you leave for the night or when things are slow.

Be sure to check out next month's newsletter for full details on how to create and update your own flat rate prices.

Written by Eric Rausin
Featured in January 2011 Newsletter