I have tried a problem we are facing in our setup by creating demo account on erpnext.com
We have an item setup for recording purchase of services (ex. Test Non-stock item in the attached screenshots) which in real scenario could be Installation and Deployment
The Gross profit shows huge loss on account of following:
- Purchase invoice of same item of 10 nos for ₹ 100
- Sales invoice of same item of 1000 nos for ₹ 10
How can gross profit of a service item be based on incoming valuation of a nonstock item
Can anyone help with this?
Yep. The report will perhaps need to be redone for non-stock items. The issue is with the logic that non-stock items get expensed out as soon as you inward them. I think you need to covert that into a cost per item and then report gross profit.
You can make a github issue for this and it will get addressed when it gets addressed. Till then your best bet is to calculate gross profit for non stock items manually. I mean use this report, export it to Excel, and find the Buying price per unit and calculate the gross profit based on (Avg Selling Price - Avg Buying Price)*Number of Units Sold.
Trust this helps.
Thank you for the reply. Will make github issue.
Hi I have the same problem. The buying amount on the gross profit is not reflecting which give a 100% gross profit if I sort the date on a monthly basis.
The company is a service company which have a none maintaining stocks as item. They create a sales order > sales invoice and purchase order > purchase invoice. Since items are a non-stock, they do not create delivery receipts or purchase receipts.
Setting of the items are on a FIFO and perpetual inventory.
How can I solve getting the buying amount on the Gross profit by filtering it on a monthly basis and by project since we tag sales and expenses by project too. But if we filter the date by month, it provides a value but not the exact buying amount (expenses) for the whole year.
Anyone’s got a solution to this? I am using v13 and I can’t still calculate the correct gross profit for non-stock service items. It doesn’t calculate the Buying Amount and the gross profit always remains at 100%. I checked the demo EPRNext instance and it is the same there too.
How do services companies using ERPNext do it? I want the system to calculate the correct gross profit. Any help would be immensely appricieated.
you can create project and book the sale as well as purchase under project it will show the project profitability depending on the transections.
Hope This helps
Thank you, Abhijit.
As I check, yes, I can see “Gross Margin” & “Gross Margin%” on the project page. I am a bit confused if it’s the same as “Gross Profit”. My goal is to always keep a check on the profit margins of my services. I am a bit disappointed that I can’t do it on the Gross Profit report page but your solution is actually quite sufficient.
If I may ask, are you in the services domain? If yes, what reports/calculations do you use to check your services, projects, and company progress? I know the answer may be a bit too long, but this would mean a lot to me as I am trying to optimize my business growth.
I am encountering this issue in 2021 and your reply is the most detailed and meaningful.
I’ve been stuck with this issue for two days and haven’t found a solid solution. I need a way to keep track of correct gross profits for non-stock items. If you’re seeing this, can please guide me on how to determine Cost Per Item and create a custom report inside ERPNext (if that’s possible). I would be immensely grateful
I made a new detailed post on this but a yet to receive a v13 solution to this. Why hasn’t been this addressed?
My post: Buying Amount (and Gross Profit) Calculation on Service Items (non-stock) | Urgent Help Needed - #4 by simple
yes we are in the service domain we are also trying out the same thing will inform once we get the clear conclusion
Been trying since a long time. Closest possibility is to make seperare items for sale and purchase and even then its not perfect.
Hi, have you guys already had a solution on the gross profit for non-stock items aside from converting the items into a maintaining stock? Since it is not practical for non-stock items (service) to make it as a maintaining stock.
Users will be confused if why there is qty stock on service items.