With InnoVint's FINANCE product, the COGS Tracking module allows you to add costs to your wine lots.
Direct costs (i.e. hard costs, or costs of the raw materials used in wine production) can be added to Fruit and Dry Goods (Additives and Packaging).
Indirect costs (i.e. soft costs, or overhead costs that usually are capitalized across all or most of your cellar) can be added to lots in a variety of cost categories, and this article describes how to allocate those indirect costs.
This article covers:
- Overview Video 🎥 Components of Wine Production Costs
- How to add or remove costs (indirect, as overhead costs)
- FAQ
Looking for information about adding direct costs? Find outr about adding direct costs for Fruit here and for Dry Goods here.
Overview Video: Components of Wine Production Costs
About direct and indirect costs in InnoVint
How to add or remove costs (indirect, as overhead costs)
Costs can be added or removed on any lot at any time regardless of its active or archived status. Whether it's a one-time cost that needs to be allocated to a single lot, an overhead that needs to be capitalized across many lots, or an adjustment to reconcile specific lot costs, you're able to do so with the 'Add/Remove Cost' action.
Check out this video on how to add costs, or read on below for the instructions.
To begin, from the Costing icon $ in your left navigation, select the button "Add/Remove costs" in the upper right of the COGS Tracking Explorer:
Complete the form, filling in the fields for the Category of overhead expense, any details about the cost (such as the period covered), and the total amount to apply across lots.
For the Effective At section, you have the option to apply the costs to inventory as of today, or work with the inventory as of a date in the past. In the case below, December overhead is being applied to the inventory as of the end of the month, December 31st at 11:59pm.
When you click to select the lots, the header confirms you're viewing inventory as of the date specified. You can use the filters to narrow down the list of lots, if needed.
Default filters: The Lot Type filter defaults to Juice/Wine lots, but is multi select, and can be set to include Case Good and/or Fruit Lots. The Lot Contents filter defaults to display only lots with contents. If you want to remove cost from empty lots, you need to change this filter to include lots with no contents.
Once your lots are selected, you'll assign how much cost to allocate to (or remove from) each lot. You can do this manually, entering in the cost for each lot, or you can use the 'Lot Cost' blue drop down link (scroll down to the next image for reference). Your options here depend on whether you are adding or removing costs:
Adding Cost
- (most common) Distribute proportionally across volume - Distributes the 'Total item cost' across the lots proportionally based on the volume displayed
- Set all costs to zero - Clears the existing cost data in the column
- $/lot - Apply the same dollar amount to each lot, pre-filling that amount down the column (in this case it may be helpful to go back and update the Total Item cost after)
- $/gal - Apply the same dollar amount to each gallon based on each lot's volume displayed, pre-filling that amount down the column (in this case it may be helpful to go back and update the Total Item cost after)
Removing Cost
Prefer a video? Go here to see our video with an example of how to remove direct fruit cost
- Current category cost - Automatically populates the entire cost from the selected cost category on the selected lots (in order to remove it)
- Set all costs to zero - Clears the existing cost data in the column
- $/lot - Remove the same dollar amount from each lot, pre-filling that amount down the column (in this case it may be helpful to go back and update the Total Item cost after)
- $/gal - Remove the same dollar amount per each gallon based on each lot's volume displayed, pre-filling that amount down the column (in this case it may be helpful to go back and update the Total Item cost after)
When removing cost, you can only remove costs existing in the selected cost category at the selected point in time. Utilize multiple remove cost actions to remove cost from multiple cost categories.
Tip: If the lot cost is applied per lot or per gallon, then leave the Total cost field blank and fill in the total after the lot costs are determined - InnoVint does the math for you!
For this example, we distributed the total cost proportionally by volume. The result is below.
Once completed, click on Add (or Remove) costs; the cost items are created, and the action will appear at the top of the Cost Item Report:
You'll also see the Costing tab on each lot's detail page update as well.
Click on Show deltas to see the actual cost change per line item. Here is the added overhead on a specific lot:
Here is an example of a removed cost, in the case of re-allocation of bleed volume:
NOTE! If you remove costs from one of our direct categories (fruit, packaging & additives), this will not modify the input cost on the actual fruit/packaging/additive cost. It only removes it from the specified lot. Remove cost functionality can be described as a 'pencil and eraser' approach: users can remove (erase) cost on a lot(s) and add (pencil in!) the cost on a different lot(s).
Note, that if the cost item is backdated and there have been movements or other activities that will affect the cost of the lot (and others thereafter), the cost will flow through those actions to catch up to present day volumes.
Additional Resources
- COGS Tracking in InnoVint (Overview)
- Onboard starting costs and update your Settings
- Fruit Costs
- Dry Goods Cost (Packaging and Additives)
- Review cost reports and reconciliation
- See how InnoVint distributes costs
FAQ
Q. My overhead cost item and bond transfer out have the same date and time, but the cost didn't get removed with the lot! Help!
A. Have you ever wondered about how InnoVint orders cost distribution if a cost action is entered with the same "effective at" date and time as an action moving volume out of the same lot? We did! And determined that the correct order of cost application (for one or more cost actions or movements occurring with the exact same "effective at" date and time) is according to the actual time of action submission (the date and time of data entry). So, if you are backdating cost actions and movement actions to the same date/time, always be sure that cost items are entered first.
In your case, it sounds like the cost item was added with the same "effective at" date and time as the B2B Out action, but was submitted in InnoVint after the wine movement. Consider editing the cost item timestamp to a minute prior to the timestamp on the B2B action. This will "break the tie" in your favor. After the lot costs update, the cost will move with the action as intended.
Q. My saignée should carry a lower cost value than the lot it was bled from. How do I record a Bleed/Saignée without distributing cost to the bleed lot?
A. We hear similar questions from users who want to "devalue" specific lots, such as lees lots or press cut lots.
The way InnoVint costing works is that any lots created from another lot inherit cost proportionate to the volume. Typically this is just fine, but sometimes we create lots that we want to carry a lower costs than the originating lot, such as bleed lots, lees lots or even press cuts.
To accommodate this, you can use the Remove cost function to remove the unwanted cost in all cost categories from a "devalued" lot. Be sure to add any removed costs back into the higher value "mother" lot using Add cost (see section above on adding or removing indirect costs). Be sure to use the Notes field to reference or link lots as necessary. It’s recommended that adjustments to remove and then add back costs to the mother lot occur on the same date, which should be just after the action that distributed the costs originally. For example, select the same date, and a time just after the Bleed/Saignée action occurred. This ensures the cost changes flow correctly through all subsequent activities on the involved lots.