Tuesday, February 23, 2010

Price Books

Okay, I talk about price books frequently in my posts... so what are they and why do I need them?

What they are:

In simple terms, a price book  helps you to record what you buy, how often and what kind of deals you are getting... and it lets you compare apples to apples…

To really have a sense of what items cost you per store, create a price book. This can help you determine trends in sales as well as cost per unit.

A handy way to keep a price book is in Excel if you have it. Take your grocery receipt and start entering! . Include the following information on your price sheet:

Regular Price
Price Paid
Unit Price
(To figure Cost per Unit - Regular Price or Price Paid divided by number of Units. For Example: $ 1.99/18 (ounces) =11 cents per ounce)

Many stores have a cost/unit price on their shelf price tags but it doesn’t hurt to double check new products with a calculator.

 Why are price books important?

A price book is important for three reasons -

It helps you track trends in your purchasing and sales
It helps you understand the sales cycle of your stores
and it helps you to compare unit prices on your purchases - it might surprise you to know that bigger isn't always better!

Price books in Excel or OpenOffice (free) give you  the freedom to make your price book sortable by every category and give you an easily updatable program... but some people still do theirs on paper - and that's an option too!

Did I give you enough information and motivation to start a price book?   Have questions? Post here and let me know!

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