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Allow the use of vouchers
02-22-2014, 12:27 PM (This post was last modified: 02-22-2014 12:39 PM by PakRicard.)
Post: #1
Allow the use of vouchers
Hi all:

I'm trying to set up webERP to allow the use of promotional vouchers (kind of "Get 50 USD OFF on your next purchase").

It is not a "credit note", and the extra benefit of controlling it as a "sold" product is that we can keep track of vouchers used.

So when customers come back and use the voucher we have to record this in webERP. I think the best way is to create a service item called VOUCHER-OFF-50 and record it as sold to the customer.

The only "but" is it has a negative price and webERP would need to allow this...

Now line 1135 in SelectOrderItems.php prevents the use of negative items. So line 1135 would read:
if ($Quantity<0 OR $DiscountPercentage >100 OR $DiscountPercentage <0){

Also, DefineCartClass.php would not need lines 109-110-111.

Does it looks reasonable to the community?

Regards,
Pak Ricard
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02-26-2014, 05:54 PM
Post: #2
RE: Allow the use of vouchers
Not keen on this Ricard .... I think it should be implemented as payment discount.

Phil Daintree
webERP Admin
Logic Works Ltd
http://www.logicworks.co.nz
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02-26-2014, 07:28 PM (This post was last modified: 02-26-2014 07:29 PM by Forums.)
Post: #3
RE: Allow the use of vouchers
I think it is more involved than a payment discount (payment discounts have different VAT rules for a start) but I can't see any way of doing this nicely with the current functionality.

Vouchers can be given freely, or can be sold (think of book vouchers, gift vouchers etc) and once issued they are a liability that needs to be shown in the balance sheet. Also it can be very useful to track them and see which customers use them and how.

With the growing number of retailers using webERP I think it deserves functionality of its own.

Thanks
Tim
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02-27-2014, 10:55 AM (This post was last modified: 02-27-2014 11:05 AM by PakRicard.)
Post: #4
RE: Allow the use of vouchers
Hi Phil and Tim:

Vouchers are not payment discounts, as vouchers have a different use in retail (as Tim stated). Vouchers are like bank notes that can be used only at your premises for a specific purpose (buying stuff or services).

I was thinking of use them for the POS side only, but Tim went even a step further with all the accounting details I did not even think about.

It usually is a physical item (a piece of paper, or a pastic card) with a cost (printing costs), and you keep some stock of it in different locations (POS and central offices) and some of them are distributed to potential customers.

My first idea (and I think it can still be used), is to record it as a service item (which fits on the POS side of the vouchers), but costs must be controlled directly vis GL, as service items have no standard costs associated. It is not a problem as costs are mostly printing costs.

To create a full voucher functionality, I'm not sure what we should keep track of, as vouchers are a liability if they are used, but most of the time they expire or end up a in drawer and are never used. Experience says only a fraction of vouchers issued are used by customers.

How should be recorded until they are used? Or are always a liability and the value of the liability needs to be adjusted somehow for destroyed, lost, expired, etc.

Let's see if we all can reach an agreement on this :-)

P.S.: Edited to add details and rewording

Regards,
Pak Ricard
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02-28-2014, 01:50 AM
Post: #5
RE: Allow the use of vouchers
Hi Ricard,

I may be wrong, but I was the accounting happening like this:

Suppose you give me a voucher valid entitling me to 10,000 Rupiah discount if I spend 200,000 Rupiah or more before the end of March. I would see this as a 10,000 Rupiah liability so

Dr P&L Marketing cost 10,000
Cr BS Liability 10,000

If I do not use the voucher then at 31st March that just gets reversed. If however I do spend it on an item with a sales value of 200,000 Rupiah then the GL transactions are:

Dr BS Liability 10,000
Dr BS Bank Account 190,000
Cr P&L Sales 200,000

What I would propose is that we create a script where these were issued, and which updated a table with voucher number (debtor no??) expiry date, and value.

When the payment is made there is a field for voucher number (could be bar coded) and once the voucher number is entered it could deduct this amount from the payment and do the above entry, also removing that voucher from the table.

Just some quick thoughts to build on, there will be holes in what I have said (for instance vouchers giving a % off).

Tim
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02-28-2014, 05:35 AM
Post: #6
RE: Allow the use of vouchers
Well what about defining a "bank account" as the voucher liability account and then "payments" using vouchers are "received" into this account - reducing the liability.
Issue of vouchers are a transfer from one bank account to another.

Phil Daintree
webERP Admin
Logic Works Ltd
http://www.logicworks.co.nz
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02-28-2014, 05:48 AM
Post: #7
RE: Allow the use of vouchers
(02-28-2014 05:35 AM)phil Wrote:  Well what about defining a "bank account" as the voucher liability account and then "payments" using vouchers are "received" into this account - reducing the liability.
Issue of vouchers are a transfer from one bank account to another.

Hi Phil, well that is sort of what I am saying, but in the example I gave that would entail entering two separate payments one for 10,000 and then another for 190,000. That would be very inefficient.

Also in a retail environment it could be good to track each voucher, providing interesting feedback on customer activity.

Tim
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02-28-2014, 11:29 AM
Post: #8
RE: Allow the use of vouchers
This is getting interesting :-)

I agree on "we create a script where these were issued, and which updated a table with voucher number (debtor no??) expiry date, and value." Then we would only need to adapt the POS script to use vouchers. Just 2 extra fields are needed, one for voucher amount and 1 for voucher code (probably voucher code is enough, as we already have the amount stored in the DB). Then when storing the payment, process both payments, one in legal tender money and one in voucher money.

Phil: "Issue of vouchers are a transfer from one bank account to another".
I like the idea of treat the issued vouchers as bank accounts, but not so sure if they ARE a transfer. When you create vouchers, you create a liability out of thin air (like real world banks create debt), so I can't see the origin bank account. I see more logical Tim's approach, creating the voucher out of the marketing P&L account.

Tim. As I understand, vouchers giving a % discount ARE sales discounts (I agree with Phil's first post POV) and can be handled perfectly with current POS script. I don't feel we need a different treatment on those. The problem came with fix amount vouchers, as they are a different beast.

So far, fix amount vouchers have:
-webERP code
-Value
-Expiry date
-Minimum amount of purchase to be used
-Number of Identical Vouchers Issued
-Number of Identical Vouchers Used
-Printed Code (can be NULL, for identical vouchers)

Identical Vouchers: In case we have 1.000 identical printed vouchers value "50 USD OFF", should we keep 1.000 rows in the table, or just one row and a counter? I think 1 row and a counter

For vouchers with printed code (1 physical voucher has 1 code), We would need 1 row for each voucher, and Number of Identical Vouchers Issued = 1

We should code:
1 script to maintain the voucher table
1 script to reverse non-used vouchers
Modify POS script to use vouchers as another system of payment
Modify System Configuration to store the GL account of the bank account used for issued vouchers

Regards,
Pak Ricard
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02-28-2014, 01:02 PM
Post: #9
RE: Allow the use of vouchers
If you sell a voucher then it is a transfer between bank accounts ... if you give vouchers as a promo (issue freebie vouchers) then you are making a payment from the voucher bank account to marketing promotion.

I will have a think a bit more about the table structure ...

Phil Daintree
webERP Admin
Logic Works Ltd
http://www.logicworks.co.nz
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02-28-2014, 03:15 PM
Post: #10
RE: Allow the use of vouchers
(02-28-2014 11:29 AM)PakRicard Wrote:  This is getting interesting :-)

I agree on "we create a script where these were issued, and which updated a table with voucher number (debtor no??) expiry date, and value." Then we would only need to adapt the POS script to use vouchers. Just 2 extra fields are needed, one for voucher amount and 1 for voucher code (probably voucher code is enough, as we already have the amount stored in the DB). Then when storing the payment, process both payments, one in legal tender money and one in voucher money.

Phil: "Issue of vouchers are a transfer from one bank account to another".
I like the idea of treat the issued vouchers as bank accounts, but not so sure if they ARE a transfer. When you create vouchers, you create a liability out of thin air (like real world banks create debt), so I can't see the origin bank account. I see more logical Tim's approach, creating the voucher out of the marketing P&L account.

I think trying to reuse the bank account tables as a voucher table would be wrong. It's not really a bank account, and if one is created it could accidentally be used elsewhere causing confusion. I think it should be a separate table. It would also mean creating additional fields in the bank account table for expiry date, voucher number and amount which make no sense outside of this functionality.

Quote:Tim. As I understand, vouchers giving a % discount ARE sales discounts (I agree with Phil's first post POV) and can be handled perfectly with current POS script. I don't feel we need a different treatment on those. The problem came with fix amount vouchers, as they are a different beast.

They are sales discounts, but not payment discounts, as the VAT implications are different for each. Also companies may still want to track vouchers even as % off.

Quote:So far, fix amount vouchers have:
-webERP code
-Value
-Expiry date
-Minimum amount of purchase to be used
-Number of Identical Vouchers Issued
-Number of Identical Vouchers Used
-Printed Code (can be NULL, for identical vouchers)

Identical Vouchers: In case we have 1.000 identical printed vouchers value "50 USD OFF", should we keep 1.000 rows in the table, or just one row and a counter? I think 1 row and a counter

For vouchers with printed code (1 physical voucher has 1 code), We would need 1 row for each voucher, and Number of Identical Vouchers Issued = 1

We should code:
1 script to maintain the voucher table
1 script to reverse non-used vouchers

This should probably be one script doing both jobs

Quote:Modify POS script to use vouchers as another system of payment
We should also modify CounterSales.php and Payments.php for consistency
Quote:Modify System Configuration to store the GL account of the bank account used for issued vouchers

We don't need a vouchers table and a bank account table. For reasons I said above using a bank account table is just a hack here as the liability isn't really a bank account. For correct accounting the account should show as a current liability not as a negative current asset.

Thanks
Tim
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