Skuttlefish

Topic Overview

Purpose	This section describes the Cost Lots feature in Skuttlefish.
Introduction	Cost tracking in Skuttlefish - referred to as Cost Lots - helps accurately monitor and manage the cost of each batch or purchase of inventory at the SKU level. This ensures reliable financial reporting, accurate inventory valuation, and well-informed pricing and purchasing decisions. Product costs can vary over time due to changes in vendor pricing, shipping fees, or import duties. Cost Lots provide a way to record cost differences at the lot level. When new inventory is received, a new Cost Lot is created to capture the cost details specific to that delivery. As inventory is sold or used, Skuttlefish tracks the Cost Lots that are consumed, enabling precise Cost of Goods Sold (COGS) calculations. This level of detail supports better insight into margins, allows for variance analysis, and ensures traceability of both quantity and value of inventory over time.
Sections	This topic includes the following sections: Topic Overview Cost Lots Cost Lot Processing - Creation Cost Lot Processing - Depletion

Purpose

This section describes the Cost Lots feature in Skuttlefish.

Introduction

Cost tracking in Skuttlefish - referred to as Cost Lots - helps accurately monitor and manage the cost of each batch or purchase of inventory at the SKU level. This ensures reliable financial reporting, accurate inventory valuation, and well-informed pricing and purchasing decisions.

Product costs can vary over time due to changes in vendor pricing, shipping fees, or import duties. Cost Lots provide a way to record cost differences at the lot level. When new inventory is received, a new Cost Lot is created to capture the cost details specific to that delivery. As inventory is sold or used, Skuttlefish tracks the Cost Lots that are consumed, enabling precise Cost of Goods Sold (COGS) calculations.

This level of detail supports better insight into margins, allows for variance analysis, and ensures traceability of both quantity and value of inventory over time.

Sections

This topic includes the following sections:

Cost Lots

Navigation	The Cost Lots grid is accessible by navigating to Inventory > Cost Lots.
Cost Lots Grid	The Cost Lots grid provides a quick view of all active Cost Lots in the system. It supports searching, filtering, and sorting, along with options to export the data to Excel or PDF formats. For more detailed insights, additional Cost Lot information is available through the Reporting module.
Description	A Cost Lot is a record that links a specific quantity of inventory to its associated cost at the time of purchase. This allows Skuttlefish to track cost and inventory movement with accuracy. Each Cost Lot contains the following fields: Total Cost: The total amount paid for the item in the order. Original Quantity: The number of units initially ordered. Original Unit Cost: The unit cost of the item at the time of purchase. Current Quantity: The actual number of units received for the lot (excluding damaged or missing items). This value, along with the Total Cost, is used to calculate the actual unit cost for the Cost Lot. Available Quantity: The number of items remaining in the Cost Lot, which decreases as items are sold or consumed. Remaining Quantity: The number of units from the original order that are still pending fulfillment. Cost Lots are managed throughout the system in order to track accurate costs. Any time product is removed or replenished, Cost Lots are maintained to keep costs up to date. The examples below are intended to provide a high level illustration of some Cost Lot functionality.

Navigation

The Cost Lots grid is accessible by navigating to Inventory > Cost Lots.

Cost Lots Grid

The Cost Lots grid provides a quick view of all active Cost Lots in the system. It supports searching, filtering, and sorting, along with options to export the data to Excel or PDF formats. For more detailed insights, additional Cost Lot information is available through the Reporting module.

Description

A Cost Lot is a record that links a specific quantity of inventory to its associated cost at the time of purchase. This allows Skuttlefish to track cost and inventory movement with accuracy. Each Cost Lot contains the following fields:

Total Cost: The total amount paid for the item in the order.
Original Quantity: The number of units initially ordered.
Original Unit Cost: The unit cost of the item at the time of purchase.
Current Quantity: The actual number of units received for the lot (excluding damaged or missing items). This value, along with the Total Cost, is used to calculate the actual unit cost for the Cost Lot.
Available Quantity: The number of items remaining in the Cost Lot, which decreases as items are sold or consumed.
Remaining Quantity: The number of units from the original order that are still pending fulfillment.

Cost Lots are managed throughout the system in order to track accurate costs. Any time product is removed or replenished, Cost Lots are maintained to keep costs up to date. The examples below are intended to provide a high level illustration of some Cost Lot functionality.

Cost Lot Processing - Creation

Overview	Cost Lots are automatically created when product is added to the system (for example, during the Purchase Order process) and are used to track inventory costs at the product level. As quantities are consumed—such as when a Shopify order is processed—Cost Lots are reduced accordingly. Skuttlefish uses a First In, First Out (FIFO) costing method, meaning the oldest Cost Lots are depleted first.
Cost Lot Creation	The example below demonstrates how the system creates and depletes Cost Lots to manage inventory movements. Cost Lot Creation The current inventory includes 10 units on hand, tracked in an existing Cost Lot with a Unit Cost of $0.80 and a Total Cost of $8.00. A new Purchase Order is placed for 90 additional units at a Unit Cost of $0.80, resulting in a Total Cost of $72.00. When the order is received, the system creates a new Cost Lot for the 90 units.
Cost Lot Creation	Once the Purchase Order is fulfilled, 88 units are received, with 2 units marked as damaged. The Cost Lot for this Purchase Order retains the original $72.00 Total Cost. However, the Unit Cost is recalculated based on the actual quantity received (excluding the damaged units). The available quantity in the Cost Lot is also adjusted to reflect the two damaged items.

Overview

Cost Lots are automatically created when product is added to the system (for example, during the Purchase Order process) and are used to track inventory costs at the product level. As quantities are consumed—such as when a Shopify order is processed—Cost Lots are reduced accordingly. Skuttlefish uses a First In, First Out (FIFO) costing method, meaning the oldest Cost Lots are depleted first.

Cost Lot Creation

The example below demonstrates how the system creates and depletes Cost Lots to manage inventory movements.

Cost Lot Creation

The current inventory includes 10 units on hand, tracked in an existing Cost Lot with a Unit Cost of $0.80 and a Total Cost of $8.00.
A new Purchase Order is placed for 90 additional units at a Unit Cost of $0.80, resulting in a Total Cost of $72.00.
When the order is received, the system creates a new Cost Lot for the 90 units.

Cost Lot Creation

Once the Purchase Order is fulfilled, 88 units are received, with 2 units marked as damaged.
The Cost Lot for this Purchase Order retains the original $72.00 Total Cost. However, the Unit Cost is recalculated based on the actual quantity received (excluding the damaged units). The available quantity in the Cost Lot is also adjusted to reflect the two damaged items.

Cost Lot Processing - Depletion

Overview	Skuttlefish depletes inventory from existing Cost Lots using a First In, First Out (FIFO) method. This means that the oldest available Cost Lots are used first when processing orders or any other quantity reductions.
Cost Lot Depletion	In the example below, an order for 20 items is shown impacting the associated Cost Lots. When created, the order will adjust the Available and Committed inventory counts in Skuttlefish. Once fulfilled, Skuttlefish will: Deplete from the earliest Cost Lot first. If the Cost Lot’s quantity hits zero, move to the next Cost Lot to complete the reduction of counts.
Cost Lot Depletion	So, in the example below, the order of 20 items has fully depleted the earliest Cost Lot of 10 and reduced the next Cost Lot by the remaining 10 items.

Overview

Skuttlefish depletes inventory from existing Cost Lots using a First In, First Out (FIFO) method. This means that the oldest available Cost Lots are used first when processing orders or any other quantity reductions.

Cost Lot Depletion

In the example below, an order for 20 items is shown impacting the associated Cost Lots. When created, the order will adjust the Available and Committed inventory counts in Skuttlefish. Once fulfilled, Skuttlefish will:

Deplete from the earliest Cost Lot first.
If the Cost Lot’s quantity hits zero, move to the next Cost Lot to complete the reduction of counts.

Cost Lot Depletion

So, in the example below, the order of 20 items has fully depleted the earliest Cost Lot of 10 and reduced the next Cost Lot by the remaining 10 items.