In order to calculate the weighted average cost of a buyer's inventory (see related article), AgriDigital must convert every movement to a Free-In-Store (FIS) basis.
This step is necessary to consider all the costs related to bringing the goods into inventory, not just the cost of purchasing the goods.
This calculation depends on the type of Delivery / Order / Contract that the movement is connected to.
These documents determine what additional fees need to be added or subtracted from the adjusted contract price to produce the FIS Adjusted price.
The different Order and Contract scenarios are indicated in the table below:
Origin | Destination | FIS Adjusted Price Calculation |
Unknown/Reference | Inventory | Equals the current Weighted Average Price of Destination Inventory |
Any Origin | Purchase/Sale | (Contract Price* + Receival Fee) / (1-shrink) |
Any Origin | Purchase/Sale | (Contract Price* + Receival Fee) / (1-shrink) |
Any Origin | Purchase/Sale | Contract Price* |
Any Origin | Purchase/Sale | Contract Price* |
Any Origin | Purchase/Sale | (Contract Price* - Location Differential + Receival Fee) / (1-shrink) |
Any Origin | Purchase/Sale | (Contract Price* - Location Differential + Receival Fee) / (1-shrink) |
Contract (Ex-Farm) | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract (FOT) | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract (FOB) | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract (CIF) | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract (CRF) | Inventory | (Contract Price* + Freight + Receival Fee) / (1-shrink) |
Contract | Inventory | (Contract Price* + Receival Fee) / (1-shrink) |
Inventory | Inventory | (Weighted Average FIS Price of Origin Inventory + Outturn Fee + Freight +Receival Fee)/ (1-shrink) |
Inventory | Inventory | Weighted Average FIS Price of Origin Inventory + Order Swap Cost |
The Contract Price will be adjusted based on the difference between the quality metrics indicated on the Contract and the quality metrics of what was actually delivered.