Introduction

Managing margins in sales quotations is crucial for businesses to ensure profitability and make data-driven pricing decisions. Odoo 18 provides a built-in margin functionality that allows sales teams to analyze the profit potential of each transaction before finalizing sales orders. This blog will walk you through the step-by-step process of enabling and using the margin feature in Odoo 18.

Steps to Enable and Use the Margin Functionality in Odoo 18

1. Enable The Margins Setting

Before using the margin functionality in sales quotations, you need to activate it in the settings:

• Navigate to Sales App → Configuration → Settings.

• Locate the Margins option under the "Pricing" section.

• Enable this setting and click Save.

Once enabled, this feature will allow users to see margin details in sales quotations and orders.

2. Ensure Cost Prices Are Defined

For accurate margin calculations, the cost price of each product must be set up properly. Follow these steps to ensure cost prices are configured:

• Go to Sales App → Products → Products.

• Open the product form for the relevant products.

• Ensure that the Cost Price is defined under the Inventory tab or Purchase tab.

• Click Save to update the product details.

Setting the cost price correctly ensures that Odoo can compute margins based on the difference between the selling price and the cost price.

3. Create a Quotation or Sales Order

Once the margin feature is enabled and cost prices are set, you can create a sales quotation or order:

• Navigate to Sales App → Quotations → Create.

• Select a customer from the list.

• Add products to the sales order lines.

Each product line will now display important pricing details, including unit price, cost price, and margin.

4. View Margins on the Sales Order

When you add a product to the quotation, the following margin-related details will appear:

• Unit Price: The price based on the applied pricelist.

• Cost Price: The pre-defined cost price of the product.

• Margin: The difference between the unit price and the cost price for that specific product.

This breakdown allows sales teams to review potential profits before finalizing the order.

Formula: Margin=Sales Price−Cost Price
Example:
Sales Price (Unit Price) = 140.00
Cost Price = 120.50
Margin Calculation:
Margin=140.00−120.50=19.50

5. Analyze Margins

Using the margin analysis feature, businesses can:

• Evaluate the profitability of individual sales lines.

• Adjust pricing or apply discounts while maintaining healthy margins.

• Make informed decisions before confirming the quotation or sales order.

6. Confirm and Finalize the Sales Order

Once satisfied with the margins:

• Click Confirm to convert the quotation into a sales order.

• Optionally, export or print the sales order for further review or client communication.

Conclusion

The margin functionality in Odoo 18's sales quotations is a powerful tool that provides businesses with insights into profitability at the quotation stage. By enabling this feature and ensuring cost prices are set correctly, companies can maintain better control over their pricing strategy and ensure sustainable profitability.

By following the above steps, you can seamlessly integrate margin analysis into your sales workflow, making your pricing strategies more data-driven and efficient.