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Sunday, September 14, 2014

Unit Accounts – Statistical data really matters

The ERP has never been only a financial system, its reporting capabilities should not be limited to a statement of financial position, profit and loss, or cash flow. Statistics and numbers provide comprehensive readings for managers and directors as an essential input in the decision making process.

In one of the projects I have been working on recently, several point of sales; integrated with a backbone Dynamics GP system, manage the daily sales transactions. A huge number of sales transactions are migrated on real time bases to Dynamics GP

 

GP-POS Graph

One of the branches above is a coffee shop, with high level standards regarding customer satisfactions, the service and joy of time provided is their main asset in which they invest. They look for a system to provide important readings for this specific purpose. One of the inquiries I have received is indicated below:

I don’t want a balance sheet or income statement, that is important but traditional. My sales might be increasing as the income statement might show. Although, I might be loosing loyal customers !

For me, when it comes to statistics in Dynamics GP, something comes to my mind immediately, which is “Unit Accounts”. Unit accounts are completely similar to the common posting accounts, they are both used for transaction entry, you can keep budget for them as well. Although, Unit accounts are not used to track financial information, they track statistical data which can be compared later on to financial data. The following notes are to be considered regarding unit accounts:

  • They can be used for sales and purchasing series (AP, AR)
  • They can be used for General Ledger Journals
  • When you enter a unit account along other posting accounts on the distribution tab, the total of financial amounts (Dr and Cr) is not affected. Since unit accounts track quantities not financial data

 

Now back to the case study, how this can be enhanced to cover such a requirement related to the number of daily customers versus total sales ?
Practically speaking, the daily sales of the POS is migrated to Dynamics GP as AR invoices with cash receipts (inventory is not tracked in this example). Within the distribution (Cash and Sales), another line is added for a unit account called “Number of customers”

Sales Transactions

 

I will show below one of the daily sales transactions along with the distribution:

AR Invoice

Distribution

 

Note !
The number above unit the unit account indicates that there were 190 customers visiting the coffee shop at the 19th of December. This number doesn’t affect the financial numbers recorded for both (Cash and Sales)

After all, it was important to provide a report linking the daily total sales with the number of customers visiting the coffee shop, to be used as an important indicator of customer satisfaction, here is the result:

Total Sales - customers

Apparently, the increasing trend of sales amount is not an indicator of ultimate profit, the business is losing customers in the first half of the month. After corrective actions were applied the daily sales amount went even higher with an obvious increase of customers as well.

Statistics really matters !

Best Regards,
Mahmoud M. AlSaadi

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