Important info for the Excel calculations (page 4-5) Open Dismiss
Hi class, some of you have noticed that the gross profit outcomes on p.4 differs from that of the p.5.
At core, there are rounding differences (e.g. using 2 or 5 decimals) that quickly adds up. If you for example have only minor rounding differences at say only $0.05/SKU, at our volume of i.8mn SKU’s, the difference will be $90,000). Since this is projection outcomes we can disregard the fact when planning out logistics structure etc.
View p.4 for what it is: calculations to address your pricing decisions. Therefore, use only the pricing information from p.4 and disregard the GP outcomes on that page. Just note what the profit contribution is per SKU, e.g. ‘the GP/SKU is [example] $5.82/SKU’. Page 5, on the other hand, is the accounting outcomes.
Hence, ignore potential GP differences between p4 and p5, and use only the profit outcomes found on p.5 when making your final decision about which entry mode to recommend to your two bosses. BR / the Team
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