What is Initial Cost Price?

TLDR
The average cost of your existing stock on hand, at the point of importing your products to TradeGecko. The initial cost price is fundamental in determining the Moving Average Cost (MAC) and cannot be changed after the initial product import.

Understanding Initial Cost Price

Provided that you already acquired products before using TradeGecko, initial cost price represents the actual cost price of your inventory. This value may either be lesser or greater than the Cost/Buy Price due to several reasons.

  • Discounts: will result in a lower value of the cost price of your inventory, due to bulk discounts provided by your supplier. If an item cost $5, purchasing it in bulk may result in the item's price being reduced to $4, even though the item still costs $5 in your supplier's price list.
  • Landed costs: will result in a higher value of the cost price of your inventory. With shipping and handling fees related to acquiring stock, if an item costs $5 during purchase, it has not included the cost of getting it to your warehouse which will raise the cost to $5.50 - $6 per item etc.

Unless you are not sure of the initial cost price or if you are getting free shipping and handling for purchasing your products, it's safe to say that you can have the initial cost price value set to be the same as the product's Cost/Buy price. Regardless, this should never be left as 0, or it will render your MAC value inaccurate.

In summary, Initial Cost Price = Buy Price + Landed Costs - (any Discounts) 

Caution
Once you have imported your products over from Shopify or Woocommerce you must set up your initial cost price promptly to ensure accurate Cost of Goods Sold. This is easily done by importing a CSV file with Initial Cost Price details. 
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