Product Types - Definitions and Differences

Modified on Tue, 04 Jun 2024 at 11:59 AM

Purpose

This SOP defines and clarifies the differences between four key product types within Cloud Retail: Standard, Voucher/Gift Card, Non-Inventory, and Not Contributing to Sales.


Definitions:

Standard Products: Tangible goods that are regularly stocked, managed inventory for, and sold at a pre-determined price. These are the core products contributing to revenue. 

Voucher/Gift Card: Pre-paid certificates representing specific monetary values redeemable for any Standard Product(s) or services offered. They do not contribute directly to sales as revenue is recognized upon redemption. Tracking inventory for these products is optional. 

Non-Inventory Products: Tangible or intangible goods delivered without requiring inventory management. These can include services performed, memberships, subscriptions, or digital downloads. Revenue for these products is recognized at the time of purchase or delivery.

Not Contributing to Sales: Items that may appear in sales but do not generate revenue. These can include internal items like samples, promotional items, and donations.


Key Differences:

FeatureStandard ProductVoucher/Gift CardNon-Inventory ProductNot Contributing to Sales
Inventory ManagementYesNoNo (may track usage)No
Sales RecognitionAt purchaseAt redemptionAt purchase or deliveryN/A
Contribution to RevenueYesNoYesNo
ExamplesBeer, Wine, and LiquorGift cards, vouchersSome stores do not track their keg rentalsSamples, promotional items, Donations

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