What COGS means
(and what it doesn't).

COGS — cost of goods sold — is one of the most misunderstood lines in any small-business P&L. The confusion comes from mixing it up with supply purchases. The rule below clarifies.

01 What does COGS mean in nouz?

COGS — cost of goods sold — is the materials cost of what your customers consumed today. For a café selling 80 cappuccinos at €0,42 COGS each, the day's COGS is 80 × €0,42 = €33,60. It's a per-day total built from per-sale unit costs, so it scales with what you sell, not with your supply runs. Sell 80 cappuccinos and 20 sandwiches and the day's COGS sums both products' unit costs.

COGS is a per-day total that depends on per-sale unit costs. If you sold 80 cappuccinos and 20 sandwiches today, the day's COGS = (80 × cappuccino COGS) + (20 × sandwich COGS).

02 What is not counted as COGS?

COGS specifically excludes three things owners often lump in. Supply purchases — the beans you bought on Tuesday are inventory, not COGS, since COGS reflects what you sold, not what you bought. Rent and salaries are fixed costs, allocated separately. One-off expenses like packaging, repairs, and spoilage go on the Expenses tab in their own categories. Each is detailed below.

• Supply purchases. The €280 of beans you bought on Tuesday isn't COGS — it's inventory. COGS reflects what you sold, not what you bought.
• Rent and salaries. Those are fixed costs, allocated separately.
• One-off expenses (packaging, repairs, spoilage). Those go on the Expenses tab in their own categories.

03 How does COGS get into my daily total?

COGS lands in your daily total via one of two paths. Product sales auto-fill COGS from the product's per-unit snapshot — 80 cappuccinos × €0,42 = €33,60, with no typing required. Manual revenue entries don't carry COGS by themselves, so if you log revenue without products, you also log your estimated COGS as an Expense line. Most owners run a hybrid of both, covered below.

• Product sales auto-fill COGS from the product's per-unit snapshot. 80 cappuccinos × €0,42 = €33,60, no typing required.
• Manual revenue entries don't carry COGS by themselves. If you log revenue without products, you also need to log your estimated COGS as an Expense line.

Most owners run a hybrid: product sales for the high-volume items, manual entries for catch-all, and a weekly COGS estimate as a top-up Expense.

04 How do I keep my COGS values accurate?

A product's COGS field is just an estimate you set when you create the product, and it stays until you update it. Real per-unit costs drift over time as suppliers raise prices and recipes change, so revisit your COGS values quarterly: re-add the per-unit recipe at current prices, compare it to your stored figure, and bump it if it's out of date. Future sales use the new value; past sales keep their snapshots, so history stays honest.

• Audit per-unit recipe. Beans + milk + cup + lid for a cappuccino. Sum the current prices.
• Compare to typed COGS. If your stored €0,42 is now actually €0,48, bump it.
• Future sales use the new value. Past sales keep their snapshots — historical numbers stay honest.