Inflation Protection: Manage Gross Margin Real Time

Coveted’s second step to manage inflation takes a bit of effort. With prices changing almost daily it is extremely important to have up to date financial reports that indicate accurate margins.

Manage Gross Margin Real Time

Most businesses are experiencing increased costs for raw materials. Additionally, to compensate for inflation, wages are increasing. Both of these should be factored into the Cost of Goods Sold. While those may seem straightforward, accounting for holding costs and work in progress can be a bit more difficult. Companies are experiencing bottlenecks in their production as they wait for specific parts or raw materials. Meanwhile their inventory stands idle, waiting to be completed and sold.

All of these variables can make it increasingly difficult to not only manage gross margin, but to accurately compute it!

Coveted Financial works with businesses to produce accurate financial reports real time so that the correct gross margin can be calculated and adjustments can be made. Even the smallest increases in margin can determine the profitability, or even break even point, of a business. If a business isn’t monitoring their gross margin frequently enough, they don’t have time to make the necessary adjustments.