COGS VS. SUPPLY

[notrub720]

My wife and I have just bought an incredible coffee shop that is being horribly mismanaged. Which is wonderful news to us because of all the hidden cash flow locked up in COGS and labor, well, and just about everywhere else. I''m setting up all of my spreadsheets and worksheets and have a question. I can''t decide if I should put the cost of all my sweeteners, half & half, cups lids, sleeves, stir sticks into my cogs, or into a supply heading. What is the industry norm? At the moment, there is no for here china in the cafe. We are planning on changing that. But for now, everything is going in paper.

Thanks for your time.

 

[Carmine Domenaco]

All of those things add to the the COGS and not to your expenses.

Supplies would be things like paper towels, toilet paper, mops, dish soap and all of the other things that are not going into the construction of the product you are selling.