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Trickle Down Costs Guide

Luke
  • Updated

Overview

Automatic Cost Trickle-Down ensures your inventory costs stay accurate even when vendor invoices, shipping charges, or other costs change after you've already created packages. When you update a non-cannabis ingredient cost, Canix automatically updates all packages that used that ingredient — proportionally by weight.

Why This Matters:

  • Accurate financials - Your COGS reports reflect true costs, not estimates
  • Save time - No more manual Excel exports and re-uploads
  • Better decisions - Know your real profit margins on every product
  • Audit compliance - Complete cost trail from source to final product

How It Works

The Problem

You receive 100,000 vape cartridges from China at an estimated cost of $250 per unit. You book them into Canix and start production. Two weeks later, your supplier sends the actual invoice: $275 per unit due to increased shipping costs.

Without Trickle-Down: You'd need to manually identify every package using those cartridges, download thousands of records to Excel, calculate the cost increase for each one, and re-upload. Most operators simply don't bother — they accept inaccurate costs.

With Trickle-Down:

  1. You edit the non-cannabis lot cost from $250 to $275
  2. Canix shows you which packages will be updated
  3. You click "Update Cost & Apply to Packages"
  4. Canix automatically adds $25 to every package that used those cartridges, proportionally

Enabling Trickle-Down Costs

Step 1: Enable the Feature

  1. Navigate to Facility Management > Inventory Settings
  2. Find the "Enable Automatic Cost Trickle-Down" toggle
  3. Turn it ON
  4. Review the confirmation message explaining the behavior
  5. Click "Enable"

Note: This setting applies to all future cost edits. It does not retroactively update existing costs.

Editing Non-Cannabis Lot Costs

Step-by-Step Guide

1. Navigate to the Non-Cannabis Item

  • Go to Inventory > Non-Cannabis Items
  • Find the item you need to update
  • Click on the item name to view details

2. Edit the Lot Cost

  • In the Lots section, find the lot you need to update
  • Click "Edit" next to the lot's cost
  • Enter the new cost per unit

3. Review the Impact Preview

If this lot has been used on any packages, you'll see an impact preview:

 
⚠️ Cost Change Will Affect Existing Packages

You are changing this lot from $250.00 to $275.00 (+$25.00)

This will add $0.25 to each package using this item

47 packages will be updated

Affected Packages:
- PKG-001234  |  Created: Feb 1, 2026  |  Current: $10.00  →  New: $10.25
- PKG-001235  |  Created: Feb 1, 2026  |  Current: $15.00  →  New: $15.38
- PKG-001236  |  Created: Feb 2, 2026  |  Current: $8.50   →  New: $8.63
...

[Download Full List (CSV)]

What You're Seeing:

  • Cost delta: How much the lot cost is changing (+$25.00)
  • Per-package impact: Cost added per package varies by how much each used
  • Package list: Shows which packages will be updated with before/after costs
  • CSV download: For large updates (20+ packages), download full list to review

4. Confirm or Cancel

  • Cancel: No changes are made to the lot or packages
  • Update Cost & Apply to Packages: Proceeds with the cost update

5. Track Processing

For small updates (< 20 packages), processing happens instantly.

For large updates:

 
Updating costs for 47 packages...
Processing 15 of 47 packages...

You can close this and continue working.
View status
  • Processing happens in the background
  • You can continue using Canix while it completes
  • Click "View status" to track progress

6. Completion Confirmation

When complete, you'll see:

 
✓ Cost update complete - 47 packages updated
View updated packages

Click "View updated packages" to see the full list with updated costs highlighted.

Understanding Cost Allocation

Proportional by Weight

Costs flow proportionally based on how much each package used from the lot.

Example:

You have a lot of 10,000 vape cartridges at $2.50 each. You increase the cost to $2.75 (+$0.25 per cartridge).

Package A used 100 cartridges:

  • Cost increase: 100 × $0.25 = $25.00 added

Package B used 500 cartridges:

  • Cost increase: 500 × $0.25 = $125.00 added

Package C used 50 cartridges:

  • Cost increase: 50 × $0.25 = $12.50 added

Each package receives a cost increase proportional to how much of the lot it used.

Multi-Level Cascading

If packages have been split into children (and those children split into grandchildren), costs cascade through the entire family tree.

Example:

Non-cannabis lot cost increases by $100.

 
Parent Package (used lot directly)
├─ Gets $10 increase (used 10% of lot)
│
├─ Child Package A (10g out of 100g parent)
│  └─ Gets $1 increase (10% of parent's $10)
│
└─ Child Package B (25g out of 100g parent)
   └─ Gets $2.50 increase (25% of parent's $10)

You don't need to do anything special — Canix automatically handles the full lineage.

What Happens to Sold Packages?

Sold and transferred packages are also updated.

Why?

Your point-in-time inventory reports need to show accurate historical costs. If you sell a package on February 5th for $1 cost, then update the cost to $2 on February 10th, your February 5th financials should reflect the true $2 cost.

How It Works

Scenario:

  • Feb 1: Package created with $1 non-cannabis cost
  • Feb 5: Package sold to customer
  • Feb 10: Non-cannabis lot cost updated, package cost increases to $2

Result:

  • Package cost is updated to $2 backdated to February 1st (creation date)
  • Point-in-time inventory report for February 5th shows $2 cost
  • Your COGS for that sale now correctly reflects $2, not $1

Where to See It:

  1. Go to the sold package in Packages table
  2. Click on package tag to view details
  3. Go to Cost History tab
  4. You'll see:
 
   Feb 10, 2026  |  Non-Cannabis COGS  |  +$1.00  |  Inherited from NCI lot #12345
   (Hover for tooltip: Effective date: Feb 1, 2026 | Edit date: Feb 10, 2026)

Viewing Cost History

Every cost change is tracked in the package's cost history.

To View:

  1. Open any package
  2. Click the "Cost History" tab
  3. See all cost additions and changes

Example Cost History:

 
Date            | Type              | Amount   | Source
--------------- | ----------------- | -------- | ---------------------------
Mar 15, 2026    | Non-Cannabis COGS | +$0.25   | Inherited from NCI lot #789
Mar 1, 2026     | Labor COGS        | $5.00    | Manual Entry (John Doe)
Feb 28, 2026    | Cannabis COGS     | $15.00   | Split from parent (initial)
Feb 28, 2026    | Non-Cannabis COGS | $10.00   | Split from parent (initial)

What You're Seeing:

  • Date: When the cost was added (or edit was made)
  • Type: Cannabis, Non-Cannabis, or Labor COGS
  • Amount: Cost added (+ prefix for inherited costs)
  • Source: Where the cost came from
    • "Inherited from NCI lot #789" = trickle-down cost (click to view lot)
    • "Manual Entry" = user added directly
    • "Split from parent" = cost from parent package at creation

Inherited Costs Show:

  • Clickable link to the source lot
  • Tooltip with effective date vs. edit date
  • User who made the lot edit

Tracking Update Status

For large cost updates, you can track processing status.

Access Status Page

  • Click "View status" in processing modal, OR
  • Go to Settings > Data Jobs

What You'll See

 
Cost Trickle-Down Jobs

Job ID: #45678
Initiated by: john@company.com
Start time: Mar 15, 2026 10:23 AM
Status: Complete ✓
Packages affected: 147
Packages completed: 147
Packages failed: 0

[View Details]

Status Types:

  • Processing - Update in progress
  • Complete - All packages updated successfully
  • Partial - Some packages failed (see details)
  • Failed - Update did not complete

Job Details Include:

  • List of all updated packages
  • Any error messages for failed packages
  • Download options (CSV of success/failures)
  • Retry option for failed packages

Point-in-Time Inventory Reports

How Trickle-Down Affects Reports

When you update costs retroactively, your historical reports change to reflect the new accurate costs.

Important: Cost updates are backdated to the package creation date, not the date you made the edit.

Example Scenario

Your Actions:

  1. Feb 1: Receive vapes at $2.50 each, create packages
  2. Feb 15: Sell 1,000 units
  3. Feb 28: Get actual invoice showing $2.75 per unit
  4. Feb 28: Update non-cannabis lot cost from $2.50 to $2.75

Report Behavior:

Inventory Value Report (Feb 15, before update):

  • Shows packages at $2.50 each (old cost)

Inventory Value Report (Feb 15, after Feb 28 update):

  • Shows packages at $2.75 each (updated cost)
  • Even though the report date is before the edit date

Why: The cost effective date is Feb 1 (when packages were created), so the $2.75 cost applies to all dates from Feb 1 forward.

Which Reports Are Affected?

  • Inventory Value Report - Shows updated costs for historical dates
  • COGS Report - Shows updated costs for sold items
  • Cost Analysis Reports - Reflect accurate costs across all time periods

This ensures your financial records reflect true costs, even when invoices arrive late.

Troubleshooting

"Some packages failed to update"

If you see a partial success message, some packages couldn't be updated.

Common Causes:

  • Package was deleted during processing
  • Permission issues
  • Database timeout

What to Do:

  1. Click "View details" to see which packages failed
  2. Review error messages for each failure
  3. Click "Retry failed packages" to try again
  4. If issues persist, contact support with the Job ID

"Processing is taking too long"

Large updates (1,000+ packages) can take several minutes.

What to Do:

  • Check the status page (Settings > Data Jobs)
  • See real-time progress: "Processing 456 of 1,247 packages..."
  • You can continue working in Canix while it processes
  • You'll receive a notification when complete

Typical Processing Times:

  • 100 packages: < 10 seconds
  • 1,000 packages: 30-60 seconds
  • 10,000 packages: 5-10 minutes

"I don't see the impact preview"

The preview only appears if the lot has been used on packages.

If You Don't See It:

  • The lot hasn't been applied to any packages yet
  • Your cost edit will save normally without triggering trickle-down
  • Once you use this lot on packages, future edits will show the preview

"Can I undo a cost trickle-down?"

Short answer: Not directly, but you can reverse it manually.

To Reverse:

  1. Edit the non-cannabis lot cost back to the original amount
  2. The reverse trickle-down will apply (subtracting costs from packages)
  3. Review the preview to confirm it's reversing correctly
  4. Confirm the update

Note: If you've made other cost changes to packages in between, reversing may not return to exact original values.

Best Practices

Review Before Confirming

Always review the impact preview carefully before clicking "Update Cost & Apply to Packages." Check:

  • Package count matches your expectation
  • Cost delta is correct
  • Creation dates align with when you used this lot

Use CSV Download for Large Updates

For 20+ packages, download the CSV to review in Excel:

  • Verify all affected packages are correct
  • Check before/after costs make sense
  • Spot any unexpected packages

Update Costs as Soon as Invoices Arrive

Don't wait until month-end to update costs. The sooner you update, the more accurate your real-time reporting.

Check Point-in-Time Reports After Updates

After a significant cost update, pull a point-in-time inventory report for the relevant period to verify your financials are now accurate.

Communicate with Your Team

If multiple team members manage inventory, let them know when you've made large cost updates so they're aware financials may have changed.

Frequently Asked Questions

Does this work for cannabis costs too?

Phase 2 (coming April 2026) will support editing source cannabis package costs (like distillate) with trickle-down. Currently, trickle-down only works for non-cannabis lot cost edits.

What about labor costs?

Labor cost trickle-down will be supported when the Overhead Cost System releases (May 2026). This will allow you to spread labor, overhead, and testing costs across inventory and have them trickle down when adjusted.

Can I disable trickle-down for specific lots?

No, the setting is all-or-nothing at the facility level. When enabled, all non-cannabis lot cost edits will trigger trickle-down if packages have used that lot.

What if I change the cost multiple times?

Each cost change creates a new trickle-down. Costs are cumulative:

  • Edit 1: Increase by $10 → packages get +$10
  • Edit 2: Increase by $5 more → packages get +$5
  • Total: packages have +$15 from original

How far back in history does this work?

There's no time limit. You can update costs from months or years ago, and the trickle-down will apply to all packages that used that lot, regardless of when they were created.

What happens if I delete a package?

Deleted packages are not updated. If you try to update a lot that was used on deleted packages, those packages are skipped (not included in the affected package count).