by David » Wed Feb 04, 2015 7:54 am
There are some subtle differences actually, especially when your COO is purchasing products from your own factories to sell in your retail stores.
Freight costs are expenditures that go to third parties, whereas the rest of the purchasing costs will become incomes to your factories. In other words, if you have to pay a higher cost buying from your own factories, you are actually not decreasing your profits from a company wide perspective. On the other hand, if you have to pay heavy freight costs, it does affect your company's overall profit.
There are some subtle differences actually, especially when your COO is purchasing products from your own factories to sell in your retail stores.
Freight costs are expenditures that go to third parties, whereas the rest of the purchasing costs will become incomes to your factories. In other words, if you have to pay a higher cost buying from your own factories, you are actually not decreasing your profits from a company wide perspective. On the other hand, if you have to pay heavy freight costs, it does affect your company's overall profit.
