COGS (Cost of Goods Sold)
The COGS module forecasts your direct cost of goods sold. It works product-by-product with configurable cost categories per product — so you can model different cost components (raw materials, direct labour, fulfilment, packaging) separately and understand your gross margin at a granular level.
When to use COGS
Use this module when:
- You sell products with direct variable costs
- You want to model gross margin per product
- You're using the P×Q module and want costs to scale with sales volume
- Your COGS has multiple cost components that vary independently
Creating the module
- In your Scenario, click Add a budget
- Choose Cost of Goods Sold
- Follow the setup wizard (4 steps)
Step 1 — Introduction
Set the forecast period. Optionally link a P×Q budget version — if connected, the COGS module can read unit quantities from P×Q and automatically scale variable costs with volume.
Step 2 — Model
Products
Add the products whose costs you want to model. These should match (or align with) the products in your P×Q module if you're using volume-based cost scaling.
Cost categories
For each product, define one or more cost categories — the components that make up its total cost:
| Example categories | What they represent |
|---|---|
| Raw materials | Direct material cost per unit |
| Direct labour | Assembly or production labour |
| Fulfilment / shipping | Per-unit delivery cost |
| Packaging | Per-unit packaging cost |
| Third-party services | Outsourced components or services |
Each category has:
- Category name — as it appears in your reports
- Monthly cost values — entered per month
Volume-based costs (P×Q link)
If you linked a P×Q budget version in Step 1, cost categories can be configured as per unit costs:
- Enter a unit cost per category
- COGS multiplies unit cost × P×Q quantity for each month automatically
- When you change quantities in P×Q, COGS recalculates
Fixed COGS
Not all COGS is variable. Some cost categories are semi-fixed (e.g. a minimum production run, a fixed-cost warehouse). Add these as direct monthly values independent of P×Q quantities — similar to a Simple Budget entry within the COGS module.
Step 3 — Mapping
Assign budget accounts per cost category:
- All categories can map to a single "COGS" budget account
- Or assign each category to a separate account for detailed cost-of-sales reporting
- Analytical axis assignments enable per-product or per-region cost breakdowns
Step 4 — Result
Review the monthly COGS forecast per product and category:
- Cost per category per month
- Product-level COGS total
- Implied gross margin (if revenue from P×Q is configured in the same scenario)
Gross margin analysis
With P×Q and COGS both configured, the Revenue dashboard shows your forecasted gross margin (Revenue – COGS) and gross margin % alongside actuals. This is one of the most actionable views for product-driven businesses.
Output in reports
COGS maps to the cost-of-sales lines in your P&L. In Forecast view, gross profit = Revenue – COGS. Drill-down shows cost per category.