Pricing Realization & Margin Impact

The Pricing Realization & Margin Impact report answers two related questions every shop should ask monthly:

1. Are we keeping list price? (Realization %)
2. What’s discounting costing us in actual margin? (Hyp GP % vs Actual GP %)

It groups by salesperson or customer in Summary, with Detail showing one row per invoice.

The columns

For each row (salesperson, customer, or invoice in Detail):

• List — qty × UnitPrice summed across the invoice’s lines (stones pass through their lot price). What you’d have collected at full price with no discounts.
• Cost — live cost from inventory + every entry in item_additional_costs (recerts, repolish, repairs). Same cost basis the Gross Profit report uses, so the two reports reconcile.
• Discount — sum of CashDiscount across the invoice’s lines. This is what you see as “Adjustment” elsewhere in the app.
• Realization % — Realized ÷ List, where Realized = List − Discount. “Of the listed price, what % did the customer actually pay.”
• Hyp GP $ — List − Cost. The gross profit dollars you would have made at full list with no discount. Red only when it’s a loss.
• Hyp GP % — (List − Cost) ÷ List. The margin you would have realized at full list with no discount.
• Actual GP % — (Realized − Cost) ÷ Realized. The margin you actually realized after discounting.

The gap between Hyp GP and Actual GP is the cost of discounting expressed as margin lost.

The “every dollar of discount = a dollar off GP” rule

Discount $ = Hyp GP $ − Actual GP $ exactly. Every dollar discounted comes straight off your GP dollar — there’s no “discount it from the markup, not the margin” trick. Knowing this number per salesperson is what makes the report useful for coaching.

Trade-ins

Trade-ins are absorbed into the per-invoice math via signed sums (the negative UnitPrice on the trade line offsets the inflated list on the sold line, and the negative cost on the trade absorbs the inventory acquired). The result: the trade’s true economic impact appears as reduced Hyp GP %, not as a discount line. If you over-credit a trade by $25k, that $25k shows up as 20-30 percentage points of compressed Hyp GP — never as a discount.

Partnership sales

An invoice with a partnership piece on it shows a P beside its invoice number. By default the report uses the full invoice.

Tick Show partnership sales at our share to count only your share of those pieces. List, Cost, Discount, Realized and both GP columns shrink together, so Realization % stays the same and only the dollars change. A settlement invoice (a partner made the sale) already is your share and reads the same either way. See Partnerships.

Summary vs Detail

• Summary — one row per salesperson or customer, sorted by Discount $ DESC so the biggest margin-erosion offenders rise to the top.
• Detail — one row per invoice, with all the same columns plus Lines (count of orderdetail rows that fed the invoice). Click any salesperson or customer label in Summary to drill into their invoices.

A removable filter pill appears in Detail when drilled in; click the × to widen back out.

Reading the numbers

A few patterns and what they usually mean:

• High Realization, low Actual GP — you’re holding price but your costs are too high. The GP report will tell you which items are the problem.
• Low Realization, high Actual GP — you’re discounting heavily but margins are still healthy because your list-price markups are aggressive. Sustainable up to a point.
• Hyp GP and Actual GP both low — selling commodity items at thin margins. Discounting isn’t the problem; what you carry is.
• Hyp GP and Actual GP both high, but discount is non-zero — the discount eats some margin but the cushion’s there. Usually fine.

Color coding

Red means you lost money — nothing else. The report used to paint anything under a fixed set of jewelry-retail benchmarks red, which flagged almost every row for a shop that sells wholesale, where a single-digit margin is an ordinary deal.

Hyp GP % is the margin you intended before any discount, so it’s the column measured against your own expectation:

• negative — red
• below your Margin Warning % — amber
• otherwise green

Set Margin Warning % in Settings → Organization → Profit Reports. Leave it blank — the default — and nothing is ever flagged amber. Actual GP % is that same sale after the discount, so it’s only red when the sale genuinely lost money; judging it against the same bar would flag the discount twice on the one report whose whole subject is the discount.

Realization % is how much of list price survived. A low one is a discount, which is what this report is for, not an error — so it shades from green down to amber and is only red if it goes negative:

• ≥95% green
• ≥90% blue
• below that, amber
• negative — red

Tips

• For monthly leadership reviews, run Group by Salesperson, Summary — the Discount $ column is your “who’s giving away the most margin” leaderboard.
• For customer reviews, Group by Customer, Summary — sorts naturally to your most-discounted accounts at the top. Negotiate accordingly.
• When numbers don’t match the GP report, check whether you’re including/excluding voided invoices the same way (this report excludes voided always).
• Don’t read Realization % alone — a salesperson with 100% Realization on a money-losing product mix is still hurting you. Always pair with Actual GP %.