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Why is the shipment Margin different than expected ?

Unexpected margin results often arise from inconsistent charge types.

How Margin is calculated in Scope

In Scope, the margin is calculated using the following formula:

Margin = (Shipment Profit / Income excluding transit costs) × 100%

Understanding Incorrect Calculations

A charge type is identified as "Transit" when the corresponding flag is set to active.

If the margin calculation produces unexpected results, it is often due to inconsistencies in how costs and income are recorded. This typically happens when different charge types are used for costs and income, with only one of the charge types marked as "Transit."

To avoid this issue, apply one of the following solutions:

  1. Ensure that both charge types are marked as "Transit."
                                               
                                                  Or
  2. Ensure that neither charge type is marked as "Transit."

By using consistent settings, you can prevent discrepancies in the margin calculation.

 
Below two examples of wrong calculations and one example of a good calculation.

Wrong calculation 1 

DT is marked as "Transit"

Cost and Income with different charge  type (the other not marked as "Transit")

    Charge type     Income     Cost     Profit
    DT     € 1000       € 1000
    CUSCLE     € 75     € 1035  - € 1040
          € 40

Margin   =    960 / 75 * 100 %  = - 1280 % (expected 53.3 %) 

 

Wrong calculation 2 

DT is marked as "Transit"

Cost and Income with different charge  type (the other not marked as "Transit")

    Charge type     Income     Cost     Profit
    DT       € 1000  - € 1000
    CUSCLE       € 35     € 35
    DDP Cost     € 1075       € 1075
          € 40

Margin   =    1040 / 35 * 100 %  =  96.7 %     (expected 53.3 %) 

 

Correct calculation 

DT is marked as "Transit" on the Income and Cost charge types

    Charge type     Income     Cost     Profit
    DT     € 1000     € 1000   
    CUSCLE     € 75     € 35  - € 40
          € 40

Margin   =    40 / 75 * 100 %  =  53.3 %