Tracking Purchases and Sales By The Load

Memos Link Purchases And Sales To One Truck, Ship, Contract, Etc.

Memos in Produce Magic Software are a very powerful way to link any number of Purchase Orders and Sales Orders to one Truck, one Ship, one Contract, one “Deal”, etc. Memos make it easy to see the total profit and loss for the Truck, Ship, Contract, “Deal”, etc.

Memos typically link Sales Orders and or Purchase Orders to one Truck, but it could be used for any grouping purpose. Memos can be used for more than combining Purchase Order and Sales Orders. Memos are also an excellent way to link several Sales Orders together or to link several Purchase Orders together to share costs for one truck, one Ship, one Contract, one “Deal”, etc.

An Importer could use a Memo to link the Inventory Lots from one Ship together, so all of the purchases from that one Ship are tied to the sales for the Inventory Lots from that one Ship. This provides a simple way to see the total profit and loss for the entire Ship.

Product for a Memo can be purchased from any number of vendors on any number of Purchase Orders. There could be thousands of Separate Purchase Orders from any number of vendors and thousands of Inventory Lots on one Memo, if the Memo was used to track an entire Ship or an entire Contract. Purchases can come before Sales Orders, or visa versa on Memos.

Memo Costs Are Allocated to PO Headers, Lines and Inventory Lots

All costs for a Memo as a whole (one Ship, one Truck, one Contract, etc.), could be added to the Memo Level. Costs added to the Memo Level, are allocated to the Purchase Order Headers, Purchase Order Line Items and Inventory Lots for that Memo.

Costs from the Memo are not allocated to Sales Orders for the Memo, because all costs from the Inventory Lots flow to the Sales Order line items using those Inventory Lots. Since all of the Memo costs flow to the Inventory Lots, those costs end up on the Sales Order Line Items through the Inventory Lots that supply their product.

Many of the costs in the produce industry are costs for the entire Truck, entire Ship, entire Contract, etc. Adding payables to the Memo level makes it very simple to allocate those costs evenly to the entire Memo. Examples of Memo level costs are Freight, Handling, Custom Broker Fees, Pallet Charges, etc.

Each Memo Truck Is A Rolling Warehouse With Rolling Inventory

Product can be purchased from any number of vendors and put on one truck and sent on its way to the desired market, before the product is sold.

We call this “Rolling Inventory”. The truck is like a rolling warehouse and the product on the truck is the Inventory for that rolling warehouse. During certain times of the year, products from specific market areas are in high demand, and product and trucks may be difficult (and costly) to obtain.

For those types of markets, it is often better to purchase the product and book the trucks before any sales are made, then send the loads to a major market where there is high demand for those products. The product can be sold while the load is en route to its market.

Memo Summary Provides Detailed Information And Complete Profit And Loss

Memos allow any number of purchases (pick ups) to be made to supply inventory for the Memo (truck, etc.) and any number of sales (drops) to be made from that Memo’s inventory. Each Sales Order line item or split line item uses an Inventory Lot.

The sales lines get their product costs from the Inventory Lot used to fill that line. The Inventory Lots contain their share of the costs from the Memo such as freight, handling, etc., so very accurate, detailed profit and loss information is stored for each Sales Order line item and each split Sales Order line item. Sales Order line items can be split any number of times to allow any number of Inventory Lots to be used to fill the quantity.

The printed Memo Summary shows all of the information about the purchases and sales for the Memo and prints the Sales Order line items and split line items showing where each of the Inventory Lots were used. The Purchase Order Line Items are listed in order of pickup date and pick up time and have a subtotal for each Vendor Purchase Order.

The Sales Order Line Items are listed in order of delivery date and delivery time and have a subtotal for each Customer Sales Order. The Memo Summary also lists all of the payables and receivables for the Memo and shows the profit and loss on each sales order and the profit and loss on the entire memo.

This format makes it easy to pay salespeople commissions on the Profit and Loss for the Memos. Payables and Receivables can also be verified from the Memo Summary.

Any Number of Comments Can be Added To Purchases, Sales and Memos

Default comments can be created for each Vendor – Received From combination and for each Customer – Ship To combination and can be included automatically in Purchase Orders and Sales Orders.

These comments could contain directions for the truck driver. If comments regarding directions or special instructions can prevent phone calls from truck drivers, they should certainly be set up as default comments so they will be included each time for that Vendor or Customer location.

Truck Dispatch Documents

The Truck Dispatch documents print each pick up and each delivery in order or date and time. Any number of notes and comments can be included for each pick up and each delivery.

The Truck Dispatch documents show the weight for each line item instead of the cost. No costs or sales prices are included on the Truck Dispatch documents. The Truck Dispatch documents can be printed for all orders, whether they are a Memo or not.

Freight Vendor Documents

The Freight Vendor documents include all of the information on the Truck Dispatch Documents. Plus it also includes all Accounts Payable information for that Vendor.

As with the Truck Dispatch documents, the Freight Vendor document shows the weight for each line item instead of the cost. No costs or sales prices are included on the Freight Vendor documents, other than the Accounts Payable items for that one Vendor.

Using Departments And Warehouses Versus Memos

Each Sales Order and Purchase Order has a main Department / Warehouse assigned to it. Each line item also has a Department / Warehouse assigned to it, which is normally the same as the main Department / Warehouse in the order header, but it can be different.

Reports can be printed by Department / Warehouse to separate different types of transactions and to allow separate accounting. Each Site (Company) and Department / Warehouse combination can track inventory to a separate Inventory Site (Product Site), or it can be set to not track Inventory at all.

Departments and Warehouses are used interchangeably and are the level of tracking below the Site (Company). Some companies call that level ‘Warehouses’ and others call that level ‘Departments’. Inventory can be separated very easily into different Departments / Warehouses.

Inventory Lots can only be selected for a line item if the Inventory is in the Inventory Site used by the Department / Warehouse on that line item. This allows separating sales reports based on the Department / Warehouse in each line item. One Sales Order or Purchase Order could contain any number of Departments / Warehouses. Each Site (Company) and Department / Warehouse combination can have a different General Ledger Account Number for each of the 40 Cost Types.

For most purposes, using different Departments / Warehouses will separate sales and purchases the way companies need for tracking and accounting purposes. Memos can also be used to separate sales and purchases into groups. Memos are normally used to separate sales and purchases for one Truck, one Ship, one Contract, etc.

In essence, Memos create mini-Departments / Warehouses. If it is desired to group the sales and purchases for one Truck, one Ship, one Contract, etc., a separate Department / Warehouse could be assigned to that one Truck, Ship or Contract, but that would be too much work for one time things like those. Departments / Warehouses are for major divisions.

Custom Reports For Memos

Since 120 different costs are stored in each line item, each header and each memo, reports can be designed to show detailed information for any of the particular costs that need to be examined separately.