Guided journey
Know what your stock is worth
How a bar of aluminium gets its cost, what freight and duty add to it, and the five reports that tell you where the money is sitting in your yard.
Journey complete
You have worked through every step. Keep the momentum — the next journey builds on what you just did.
All journeysAluminium is bought by weight in a currency that moves, shipped in containers that carry freight and duty, and consumed in lengths. Between those three facts sits every argument you will ever have about what a window actually cost to make.
The first half of this path decides how cost is calculated and lands freight where it belongs. The second half is five reports — and the one to start with is aging, because slow-moving profile in a discontinued finish is the most common way a fenestration company loses money without noticing.
By the end you will be able to
- Choose a costing method deliberately, and know what it does to your margin when metal prices move
- Land freight, duty and clearing onto the cost of the material they arrived with
- Value stock lot by lot when two batches of the same profile genuinely cost different amounts
- Account for scrapped aluminium and broken glass so waste shows as a cost, not as a disappearance
- Read what you hold and what it is worth, at any date
- Find where a material is physically sitting when the shelf and the screen disagree
- Trace every movement of one bar or one sheet, from receipt to the opening it ended up in
- Spot slow-moving stock before it becomes obsolete stock
- Watch the warehouse on a dashboard rather than in a monthly report
Before you start
- Product categories carrying their costing and valuation accounts — "4- Setup Your Product Catalogue and Designs"
- A chart of accounts and analytic plans that these postings land in — "8- Setup Accounting and Invoicing"
- Real receipts and issues in the system, because valuation on an empty warehouse teaches nothing
- Your accountant's agreement on the costing method before you change it — switching it later re-values everything you hold
The path
01
Decide how cost is calculated
- 01 Choose a costing method Standard, average or FIFO cost — and the choice matters more in this industry than most, because aluminium prices move and a job quoted in March is fabricated in June. Decide with your accountant, and decide once. 5 min Choose a costing method
- 02 Land the freight and the duty A container of profile carries sea freight, duty, clearing and inland haulage, and none of it is on the supplier invoice. Landed costs push those onto the material itself, so the cost you cost a window at is the cost it truly arrived at. 7 min Add freight and duty to product cost
- 03 Value it lot by lot Two containers of the same profile, bought three months apart, genuinely cost different amounts. Lot valuation keeps that distinction instead of averaging it away, which matters when you are asked what a specific tower consumed. 7 min Value stock lot by lot
- 04 Account for what you scrapped Offcut, scratched profile and broken glass have already been paid for. Posting scrap to an expense account makes waste visible as a number in the accounts rather than a quantity that quietly vanished from a shelf. 5 min Account for scrapped goods
02
Read the five reports
- 05 See what you hold and what it is worth The headline report: quantity and value, at a date. Run it at month end against the balance sheet figure, and any gap between the two is a conversation worth having before the auditor has it for you. 6 min Check stock and its value
- 06 Find where a material is sitting The screen says you hold forty bars; the storeman cannot find them. This report says which location, which lot, and how much is reserved to somebody else — which is usually the answer. 7 min Find where stock is sitting
- 07 Trace one bar all the way through From the container it arrived in to the opening it was cut for. This is the report you need when a consultant asks which batch went into a facade, or when a finish problem has to be traced back to a supplier delivery. 5 min Trace every movement of a product
- 08 Find the stock that stopped moving Start here if you only read one. Profile in a finish you no longer sell, ordered for a job that was cancelled, is the quiet way a fenestration company loses money — and aging is the only report that shows it before a stock write-off does. 1 min Run the stock aging report to identify slow-moving material
- 09 Put the warehouse on a dashboard The last step turns the four reports above into something looked at weekly rather than requested annually. A dashboard somebody glances at beats a report nobody runs. 9 min Watch warehouse performance on a dashboard
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