Some background info
Every product in MarginEdge is coded to a Category. Because more than one Category in MarginEdge can be mapped to a GL account in your accounting system, you are able to have a more granular set of “Categories” in MarginEdge than you have set up in your Chart of Accounts while still keeping the two systems in sync.
Each Category in MarginEdge is set to a Category Type. There are seven default Category Types:
- Food, Beer, Wine, Liquor, N/A Bev, Retail, Other
The Category Type determines where you will see purchases on your Controllable P&L. For anything labeled as Food, Beer, Wine, Liquor, N/A Beverage, and Retail, purchases will appear in the Cost of Goods Section of the P&L. Any purchases with categories set to Category Type “Other” will appear under the Expenses section of the P&L.
The Cost of Goods Sold calculation is made by comparing the total value of purchases and inventory adjustments in a Category Type (e.g. Food or Beer) vs the total value of the sales attributed to the same Category Type in a given period.
For more details, check out this article: General Ledger Accounts, Categories, and Category Types.
What this Feature Offers
If your restaurant sells products that don't fit neatly into one of these Category Types (like Saké for example) or if you'd just like more granular Category Types, you can now add and customize your own COGS Category Types!
The new category type will show up in all your restaurants that are in the same Company and Concept (or in other words, share a product list).
What this Feature Doesn't Do
You cannot create a new Category Type that will map to your "Expenses" on your P&L. These custom Category Types are reserved exclusively for using within your Cost of Goods Sold.
This will not work to create a new revenue center. Any custom Category Type will require that there are both sales and purchased products mapped to it. New Category Type "Sake" will be easy to connect the appropriate vendor items to their appropriate new category.
Conversely, a new Category Type called "Catering" will not have clear products that are always associated with this category. We code things based on what they are, not how you intend to use them. Onion will always be coded to Food; we won't know it was bought to be used for catering.
Another way to know if your desired Category Type might work is to ask yourself could this new Category Type be considered a sub-category of one of the existing COGS Category Types: Food, Beer, Wine, Liquor, N/A Beverage, and Retail? If yes, you are on the right track!
How to Implement This
1. Create the Category Type
Go to Accounting > Categories and find this new button labeled : "Manage Category Types"
Then click to "Add new Category Type".
Set the Category Type Name then choose an Ingredient Type. If this is something you want to be available to add to recipes, choose the applicable category. If not, choose "None". This categorization decides which button you press when you are creating recipes to add a product coded to this Category Type. For this example, Sake, will have ingredient type "Alcohol".
2. When you're done press the Save Button
3. Create any needed Categories for this new Category Type
Here's a video for how to add new Categories. Be sure to select the appropriate GL code for this new Category too!
4. Map the new Category Type in Sales Mapping
Once mapped, you'll see your new Category Type in places like the home page, Controllable P&L (under COGS), Food Usage Report, Inventory Count Sheet setup, and other places where Category Types are referenced.