Tracking Landed Costs with Purchase Orders & FOREX

Zulu has an additional feature available on top of its inventory module that allows purchasing using foreign currency and accurate tracking of landed stock costs.

Overview

When your account has Forex enabled and you're creating a delivery from a foreign currency supplier, the system provides additional fields to handle currency conversion and landed costs. This ensures your inventory costs are accurately recorded in your local currency.

Step 1: Select Supplier

When creating a new Product Delivery, you'll first be prompted to select a supplier.

1. Navigate to Inventory > Deliveries
2. Click Add New Product Delivery
3. Search for your supplier by typing their name
4. Select the supplier from the dropdown
5. Click Continue

Note: The Forex panel will only appear if the selected supplier is configured as a foreign currency supplier.

Step 2: Delivery Details Panel

Step 3: Foreign Exchange (FX) Panel

This panel appears for foreign currency suppliers.

Finding Exchange Rates

The panel provides helpful links to exchange rate websites: - XE.com - OANDA

Tip: Use the exchange rate from your bank statement or payment record for the most accurate costing.

Step 4: Landed Costs Panel

Landed costs are additional expenses incurred to get goods from the supplier to your warehouse. These costs are automatically distributed across all line items proportionally based on their value.

Note: The above fields may vary between local suppliers and international suppliers.

How Landed Costs Are Distributed

Landed costs are split proportionally across line items based on their value (line subtotal).

Example: - Total Order Value: $1,000 - Total Landed Costs: $100 - Line Item A: $600 (60% of order) → receives $60 landed cost - Line Item B: $400 (40% of order) → receives $40 landed cost

Step 5: Line Items Table

For Forex deliveries, the line items table has additional columns to show the currency conversion and landed cost breakdown.

Calculation Logic

Unit Cost (Local) = Unit Cost (Foreign) × FX Rate

Landed Adj (per line) = Total Landed Costs × (Line Value ÷ Order Subtotal)

Final Unit Cost = Unit Cost (Local) + (Landed Adj ÷ Quantity)

Line Total = Final Unit Cost × Quantity

Step 6: Save or Complete

Important: When you Complete a delivery: - Stock levels are increased for each product - Product cost prices are updated with the Final Unit Cost - The delivery becomes locked for editing

Real Example

Here's a real example from the system:

Line Item: Gouda Cheese

Step-by-Step Calculation

1. Convert EUR to NZD:
   €50.5775 × 2.05 = $103.6839 per unit

2. Calculate landed cost per unit:
   $120.00 ÷ 150 units = $0.80 per unit

3. Calculate final unit cost:
   $103.6839 + $0.80 = $104.4839 ≈ $104.48

4. Calculate line total:
   $104.4839 × 150 = $15,672.58

Multiple Line Items Example

If you had two line items:

The landed costs are distributed based on each line's proportion of the total order value.

Tips

• Always enter the FX rate before adding line items for real-time calculation updates
• Zulu will automatically fetch and save an estimated FOREX rate if you do not enter one - CAUTION: Ensure you check and modify this value BEFORE fulfilling the delivery
• Enter all landed costs before completing to ensure accurate product costing
• Use the supplier's invoice reference in the "Supplier Reference" field for easy reconciliation
• Products that don't exist in the system will be created automatically when the delivery is completed