Sales to Taproom

We have switched to the "sell to" tasting room model as opposed to the transfer method. We are selling the beer to the TR at a price equivalent to what we would sell to a distributor, rather than at cost, and we are noticing a few things;

transferring back to our main warehouse changes to the "cost" of the beer in that warehouse to the "price" we sold it to the TR at - this is a problem.

Selling out of the TR warehouse to a distributor books the cost at the "price" we sold it to the TR at, creating a loss or no gross profit on the sale due to the false cost.

"selling" to our internal sales team at $0 increases the cost hitting their budgets based on the cost we sold it to the tasting room for....

I guess I was just wondering what people are doing in any of these scenarios. I am not an accountant, but this seems like it has the potential to screw with the financials.

Comments

  • AshleyAshley Accounting Supervisor

    We were using a system similar to this when we started with Obeer and decided to change because of some of the reasons you listed above. We do the warehouse transfer method to the TR. Then once a month do a physical inventory to correct the number of kegs showing. We also do warehouse transfers to our retail stores and they do weekly physical inventories on their beer. For our Sales Rep's we do goods issues and select the account we want the money to hit.

    The only other scenarios similar to this I can think of is our Marketing and QC accounts for our retail store. We created BP's for these with zero dollar price lists. Then once a month I go in and do a JE to move the funds to the appropriate account so our retail store doesn't look like it's taking a hit for the products being removed.

    Hope this helps! :-)

  • To work around this problem, we only "sell" to the tap room once the beer has been tapped. At that point, there wouldn't be internal transfers. We "sell" the volume in a tap room tank as its depleted, and not before.

  • ZachZach Business Process Manager

    So we sell to the taproom (customer) and buy from the brewery (vendor) then we create a journal entry that debits the vendor (AP) and credits the customer (AR). Then you reconcile the accounts the accounts.

  • The retail transfer function will automatically reconcile the AR and AP balances for you. You do still need to address the inter company sales on the P&L.

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