COGS Report and Bar Margin in IZI
COGS Report and Bar Margin in IZI
Section titled “COGS Report and Bar Margin in IZI”The COGS report shows how profitably the bar is operating: how much was earned on each sold item after subtracting the purchase cost. Without this report you know revenue, but not profit.
Where to Find the Report
Section titled “Where to Find the Report”Bar → Analytics → COGS and Margin (the exact path may vary by CRM version — look in the bar or warehouse analytics section).
Set a period — day, week, month — and get a table for all sold items.
What the Report Shows
Section titled “What the Report Shows”Per Item
Section titled “Per Item”| Field | Meaning |
|---|---|
| Item | Product name |
| Units Sold | Number of units sold for the period |
| Revenue | Total sales at selling price |
| COGS | Cost of units sold (calculated using FIFO) |
| Gross Profit | Revenue − COGS |
| Margin, % | Gross Profit / Revenue × 100 |
Bar Overall
Section titled “Bar Overall”The totals row summarizes all items:
- Total bar revenue for the period
- Total COGS — how much was spent purchasing everything sold
- Gross profit — the difference
- Average bar margin — revenue-weighted
How to Read Margin by Item
Section titled “How to Read Margin by Item”Each item falls into one of these categories:
High margin (margin > 60–70%) — usually snacks, coffee, hot beverages, house-made items. The profit engine of the bar. Make sure they are adequately represented in the menu and promoted by staff.
Mid margin (30–60%) — branded drinks, juices, prepared food. The main revenue volume.
Low margin (< 30%) — usually imported or premium items with high purchase costs, specific branded water. They may stay in the menu for service reasons (customer requests), but they should not be relied on as a profit source.
Zero or negative margin — almost always an error: either no purchase price entered, or selling price is below purchase price. Requires immediate investigation.
Thresholds for Decision-Making
Section titled “Thresholds for Decision-Making”Specific thresholds depend on your menu structure and market. As benchmarks:
- Bar margin overall below 40% — signal to review purchase prices or raise selling prices on low-margin items
- Margin on a specific item dropped > 10 percentage points vs previous period — check whether the purchase price changed or whether there was an error in the last receipt
- Top 3 items by revenue with low margin — highest priority for selling price review
Margin Dynamics: What Influences It
Section titled “Margin Dynamics: What Influences It”Purchase Price Changes
Section titled “Purchase Price Changes”When a supplier raises a price, margin on that item starts declining — not immediately, but as the old batch is exhausted (FIFO). The COGS report will show the decline when the new batch kicks in. This is the signal to review the retail price.
Sales Mix Changes
Section titled “Sales Mix Changes”If this month low-margin water sold more and high-margin coffee sold less, the average bar margin will drop. Look not only at overall margin but also at changes in the category sales mix.
Data Errors
Section titled “Data Errors”Margin anomalously high (> 90%) on some item? Most likely no purchase price entered, or it was entered 10 times lower than reality. This is not profit — it is a data error.
Actions Based on the Report
Section titled “Actions Based on the Report”Item found with margin below threshold:
- Check whether the purchase price is current — has the supplier raised the price?
- If purchase price increased — recalculate the target retail price
- Update the price in the bar catalog
Average bar margin dropped:
- Look at COGS broken down by category — where are the biggest losses?
- Check for items with zero cost (data entry errors)
- Compare the sales mix with the previous period
Item with zero margin:
- Open the receipt history for this item
- Check the last 2–3 receipts — is the purchase price specified?
- If not — correct via an adjusting write-off + new receipt with the correct price
Connection to Other Operations
Section titled “Connection to Other Operations”COGS is only accurate if the underlying data is accurate:
- Receipts with purchase prices — the foundation of the calculation. Without accurate prices COGS is meaningless. More detail → First Goods Receipt
- Regular stock counts — align stock, eliminate accumulated errors. More detail → Inventory Procedure
- Manual write-offs — losses also enter COGS. Unrecorded losses artificially understate real COGS. More detail → Write-Off: Spoilage and Breakage
Related Pages
Section titled “Related Pages”- FIFO in IZI: How Cost Is Calculated — COGS calculation methodology
- Supplier Management — price history by supplier helps explain margin dynamics
- Warehouse in IZI: Overview — overall tracking logic
Frequently asked questions
What is COGS?
COGS (Cost of Goods Sold) is the cost of goods sold. For the bar, this is the sum of purchase prices for all items sold in a period. Gross Profit = Bar Revenue − COGS.
Why does IZI calculate COGS using FIFO?
IZI uses FIFO: when an item is sold, cost is taken from the earliest unconsumed batch. This is the standard for retail inventory: it reflects real product movement and minimizes the risk of stale batches.
Why did the margin on an item change when I did not change the selling price?
The purchase price of a batch changed — the old batch at one price ran out and the new one at a different price started. FIFO automatically switched to the new cost. This is normal and shows the real picture.
What does 0% or negative margin on an item mean?
Most likely, a receipt was processed without a purchase price (or with zero), or the purchase price was entered incorrectly. Check the receipt history for this item.
How often should I review the COGS report?
Monthly at period close is sufficient. Additionally — when supplier prices change or when new items are added to the menu.