Cost of Goods Sold (COGS)

cost_of_goods

Overview

Cost of Goods Sold (COGS) represents the direct costs attributable to the production of the goods sold.

📘

COGS = Total cost of goods sold

The calculation is based on data from the Orders table.

---

Detailed Breakdown

The formula above is derived from the following components:

• Cost of Goods = SUM(cost_of_goods) --> Orders table

Insights and Actions

Cost of Goods Sold (COGS) represents the direct expenses related to producing the goods you sell, providing critical insights into operational efficiency and profitability:

• Evaluate Profit Margins: Track COGS in relation to revenue to assess gross profit margins and identify areas to improve profitability.
• Optimize Supplier Costs: Analyze trends in COGS to identify opportunities to renegotiate supplier contracts or reduce material costs.
• Forecast Financial Performance: Use COGS data to predict future expenses and set accurate pricing strategies that maintain healthy margins.

Related Metrics

• Order Revenue: Helps compare production costs against revenue to calculate gross profit and assess pricing strategies.
• Net Profit: Tracks overall profitability, providing a comprehensive view of the impact of COGS on business performance.
• Shipping Costs: Offers additional context for operational expenses, enabling a more complete analysis of cost structures.

Example Use

Prompt

What was my total cogs yesterday?

Response

Query

SQL

SELECT
  SUM(ot.cost_of_goods) AS total_cogs
FROM
  orders_table AS ot
WHERE
  ot.event_date = CURRENT_DATE() - 1;