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Mr. Hung owns a small bakery in Binh Duong, supplying cakes to cafes. Orders come in regularly, and monthly revenue looks good, but at the end of the year, he can't understand why he doesn't have as much profit as he expected. He records the ingredients he buys in a notebook, calculates the monthly wages of his two workers, and includes the electricity costs for the oven as a "combined expense." When customers ask for a price quote for a new type of cake, he prices it based on intuition —a rough estimate of the ingredients and then doubles it. Some types are profitable, while others result in losses the more he makes, and he doesn't know which is which.
This is a common pain point for all self-producing businesses: not knowing how much a product actually costs to make , so every decision regarding pricing, promotions, and accepting wholesale orders is a gamble. And when orders pile up, he has a second worry: not knowing for sure if he can deliver on time , because during the shift, no one can say which batch is baking and which is waiting.
What you truly want to achieve
Mr. Hung doesn't need a complicated "production software." He needs a clear answer for each product: how much it costs in raw materials, labor, and machinery—and the total cost. From there, he can determine a profitable selling price, know which products to promote and which to discontinue. He also wants to see how much progress the factory has made that day so he can promise delivery dates to customers without having to guess. And he wants all these figures to automatically flow into the profit and loss report, instead of having to manually add them up at the end of each month.
How GTG CRM helps you do that
GTG CRM integrates features into a closed-loop production process, right on the system you use for sales, inventory, and accounting:
- Create a Bill of Materials (BOM) for each type of cake — specifying the ingredient quantities (flour, sugar, butter, etc., along with percentage loss) and the steps involved (mixing, baking, finishing in which team, and how long). Everyone can achieve the correct quantities and costs.
- Set labor and overhead costs for each team — once declared, all subsequent production orders will automatically calculate the correct labor and machinery costs, no more "estimates".
- When a production order is given, the system automatically calculates the cost of goods sold — selecting the product, recipe, and quantity; upon completion, the system calculates the unit cost of goods sold = (raw materials + labor + overhead) ÷ quantity produced . Mr. Hung sees the actual figures for each type of cake.
- Cost of Goods Sold (COGM) means that finished goods are received into inventory at their original cost, and the accounting entry is directly recorded in the general ledger, resulting in accurate profit and loss statements and eliminating "zero-cost" finished goods.
- Purchasing and Production Planning (MRP) — a system that compares inventory with customer orders and sets inventory levels, suggesting what additional materials need to be purchased and how much more needs to be produced — ensures that you don't run out of flour while production is underway, nor do you end up with tied-up inventory.
When orders piled up, Mr. Hung also wanted to know if he could deliver on time — and now he has the answer. With the Gantt chart , batches are scheduled according to oven capacity and number of workers, and even the changeover time between two types of bread is taken into account, so he can promise a realistic delivery date instead of guessing. Click Today / 3 Days / Week to see the exact period you want to view.
And right in the middle of his shift, he no longer had to run down to the kitchen to ask around. On a touchscreen located at each work station , the worker opens their work, presses Start , finishes, presses Complete , and enters the number of completed and defective items on the spot — the data enters the system instantly and is directly added to the cost of goods sold. A large wall-mounted screen (andon board) lets him see the entire factory at a glance : which work stations are running, which are idle, where there are bottlenecks, and overall productivity. If they run out of flour or the oven malfunctions, a worker touches a button and an alert is sent to him immediately.
As the factory grew, that same set of features also helped him trace the origin of the materials : assigning batch numbers to each batch so that when a customer complained about the quality, he could trace back the exact batch of raw materials used (family tree) in minutes; and receiving expiration date alerts to prevent materials/finished products from expiring. The consultants also suggested safe inventory levels and required quantities in easy-to-understand language — knowing cost of goods sold, meeting orders on time, managing the factory in real time, and tracing batches, all in one place.
See the full features in the Production Management article, or follow the step-by-step production setup guide to create BOMs, schedule, and operate the plant.
The result you received
- Based pricing : knowing the exact cost of each product, setting prices that ensure profitability instead of doubling them based on impulse.
- Knowing which products are profitable and which are unprofitable : by looking at the actual cost of goods sold, decide to boost profitable products and quietly cut back on loss-making products.
- Accurate profit and loss reporting : cost of goods sold flows directly into the accounting books, eliminating manual addition and discrepancies between different software programs.
- No material shortages, no tied-up inventory : planning based on customer orders and inventory levels ensures you buy the right products, make them right, and do them at the right time.
- Meet orders and see factory real-time : Gantt scheduling based on capacity to guarantee on-time delivery; factory screens and Andon boards show the current status of the production line and which stations are congested.
- Traceability : batch tracing + expiration date alerts enable quick handling of quality issues and prevent expired products.
- A single system : sales, inventory, accounting, and production all report the same metrics.
Frequently Asked Questions
My workshop is small, only producing a few products, does it really need to be this complicated? It's precisely because it's small that we need to know the true cost of goods sold — a slight error per product, multiplied by the production volume, results in a significant loss. You only need to enter the formula once for each product, and you can turn on the real-time workshop monitor once you're familiar with the process.
I'm writing formulas in Excel, is transferring them difficult? No. Drag your Excel/CSV file in, the AI will automatically match columns for you to browse and enter — the transfer is fast.
Does the cost of goods sold automatically enter the financial statements? Yes. When a production order is completed, the cost of goods sold entry is recorded in the general ledger, so the profit and loss statement accurately reflects the actual figures for each stage of production.
Do the workers in the workshop need to use computers? No, they don't . Just a touchscreen tablet placed in the workstation: workers touch to start, finish, and enter numbers — it's as simple as using a phone.
What if I'm producing both from inventory and on order? Both. You can produce items in advance for sale, or create a production order directly from a sales order to fill the remaining stock.
