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E-commerce Groups · Track 1 · Tutorial 1 of 2

Set up intercompany types for an e-commerce group

Before you clear anything, give each item that moves between your companies a type of its own, so it is filed and checked where your team expects it. This is the set-up that suits an e-commerce group.

You will needThe group set up, with its companies loaded and mapped. The Administrator or Data Loading Admin role for your group.
By the endThe intercompany types an e-commerce group needs switched on, its own types added, and the Intercompany menu arranged around them.

1Know what moves between your companies

An e-commerce group usually has a holding company, trading companies that sell online, a fulfilment company that holds the stock, a logistics company, and an IP company that owns the brand. These are the items that move between them:

FromToWhat
Fulfilment companyTrading companiesStock at cost plus a mark-up
Logistics companyTrading companiesFulfilment fees
IP companyTrading companiesRoyalties for the brand
Holding companyTrading companiesManagement fees
Holding companyGroup companiesLoans; dividends upward

Each item should have a type of its own, so it is filed, listed and checked where your team expects it. Your group may not have all of them, or may have others: adjust the steps below to what your companies actually book.

2Switch types on and off

  1. Select the group, and open Settings → Global Settings → Intercompany Types.
  2. Click the switch on each type below that needs changing. Each switch is saved the moment you click it.
TypeChangeFor
Inventory TransfersKeep onStock sold by the fulfilment company.
Trade Receivables / PayablesKeep onUnpaid invoices for stock, fees and royalties.
Sales / Purchases / ServicesKeep onThe base for Fulfilment Fees.
Management ChargesKeep onManagement fees, and the base for Royalties.
Unrealised ProfitSwitch onThe mark-up in stock the trading companies still hold.
Intercompany LoansSwitch onLoans between companies.
DividendsSwitch onDividends paid up to the holding company.

A new group starts with Trade Receivables / Payables, Sales / Purchases / Services, Inventory Transfers and Management Charges switched on. Other Eliminations is always on. See Switch on and add intercompany types.

3Add types of your own

  1. Click Add type.
  2. In Type name, enter Fulfilment Fees.
  3. In Accounting treatment, choose Sales / Purchases / Services, and click Save type.
  4. Add the others the same way.
Type nameAccounting treatmentFor
Fulfilment FeesSales / Purchases / ServicesPick, pack and delivery charged by the logistics company.
RoyaltiesManagement ChargesRoyalties charged by the IP company, kept apart from the management fee.

The accounting treatment decides how the type behaves and which accounts its entries accept. A type of your own is in the menu only while the built-in type it works like is switched on.

4Arrange the menu

  1. Click Manage menu.
  2. For each group below, enter its Group name and click Add group.
  3. Drag each type onto its group, and click Save menu.
The Intercompany menu for an e-commerce group: Stock holding Inventory Transfers, Unrealised Profit; Charges holding Sales / Purchases / Services, Fulfilment Fees, Management Charges, Royalties; Balances and funding holding Trade Receivables / Payables, Intercompany Loans, Dividends
The menu grouped the way the team works.
GroupTypes in it
StockInventory Transfers, Unrealised Profit
ChargesSales / Purchases / Services, Fulfilment Fees, Management Charges, Royalties
Balances and fundingTrade Receivables / Payables, Intercompany Loans, Dividends

See Arrange the Intercompany menu for moving, renaming and removing groups.

Check

Intercompany in the sidebar shows the groups above, and each type of your own is listed on Intercompany Types with Kind Custom and status Active.

5If something goes wrong

A type of your own isn’t in the menuThe built-in type it works like is switched off. Switch it on.
… cannot be used in this elimination type.The type’s accounting treatment doesn’t accept that account. Check the table in Switch on and add intercompany types, and choose the treatment whose accounts fit.
The arrangement was lostThe dialog was closed without Save menu. Arrange it again and save.

Want more detail? See the documentation

Intercompany Types Intercompany Eliminations Guide
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