I have been searching for a solution for this problem on Google and on the forums here and can't seem to nail anything down.
For my shop, we order from different wholesalers and distributors depending on availability and pricing for the same item. Example: "Pink Cup" on my shop can be ordered from Wholesaler A (WA) or Distributor B (DB), but once it arrived in our warehouse, and how it's listed online for our customers, it's the same product and the inventory is put all together. There are many factors on the back end for us as to why we may order from WA or DB but ultimately WA's cost per item is different than DB's cost per item which then changes our profit margins.
We are currently trying to fine-tune our analytics and profit projections and are looking for a way to input the two different Costs Per Item and their inventory representation in our warehouse but can't seem to find an option for this. If our warehouse inventory has 5x of Pink Cup from WA and 10x of Pink Cup from DB how do we accurately measure our profits on the back end when the inventory is put together for fulfillment?
I've read the articles on pricing products from Shopify and we've been "averaging" things up to now but are now in need of more concrete numbers.
I looked into re-working variants to make this a possibility but ultimately it was too confusing on the customer-facing side of things.
Any app recommendations or help is much appreciated! Thank you.
Ran into the same problem as you for two Shopify stores I have run. As an accounting nerd there are four methods to costing / valuing inventory:
1. Specific identification: keeping track of the purchase cost of each item
2. Average cost: average purchase cost of each item is computed
3. First-in, first-out (FIFO): assumes you sell the oldest merchandise first, so it assumes most recently purchased merchandise is the cost
4. Last-in, first-out (LIFO): opposite of FIFO
Each system has its own merits depending on the industry. For e-commerce, there are limited reasons not to have specific identification because of the capability to gather and store the data. It looks like you want specific identification.