First In First Out (FIFO) Costing

IMPORTANT:  For multigym deployments with linked retail, you must be cloud hosted to use the First In First Out (FIFO) costing method. This is due to the extensive SQL required to analyze the cost history of a product when transfers are involved.

 

FIFO Overview

FIFO costing means that the cost applied to a sold inventory item is allocated based on a “first in, first out” order from available inventory.  This is different from RGP’s basic costing method, which applies the latest restock’s unit cost for any new sale.  

 

Operational Considerations

IMPORTANT: Anytime a historical restock is changed or a restock is added in the past, RGP will recalculate all of the costs for all impacted sales. This is a requirement as otherwise errors cannot be corrected (for example, if you realize a restock 4 months ago had the wrong unit cost).  

 

Enabling FIFO Costing

 Data Entry -> Manage -> Settings -> Manage Cost Method

Note: A password from RGP support is required to activate this feature.

You can later rollback to Basic Costing using the same method.  All historical costs are recalculated whenever the costing method is changed.

MULTIGYM:   It is critical that all of your RGP instances be updated to the latest RGP version before enabling the FIFO costing method.  If your facilities have linked retail, enabling FIFO at one location will automatically enable it at all other locations.  

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Interface Changes with FIFO

Manage Products / Restocks

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FIFO Allocation Grid (shown when clicking the FIFO button above)

This tool allows you to see how sales have been applied to specific restocks.

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Report Changes

With FIFO, there are two “Inventory - Count” reports.  One showing the data using the Basic Costing (Legacy) method, and one showing the data using the FIFO method.

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