In this episode of the Mission Business Podcast, we share how QuickBooks can be used to track inventory and solutions to specific issues that inventory based businesses may face with QuickBooks.
If you have any questions about this podcast episode, feel free to contact us.
Full Transcript of Audio Below
We’ve transcribed the audio into text and formatted it for easy reading below. Please excuse any typos or odd wording, as this transcript is taken directly from the spoken word within the audio above.
The Importance of Inventory Tracking
Interviewer: Welcome back to the show. Today, we are talking with Bernard again and I’d like to go over the types of things that QuickBooks can do for inventory-based businesses. I’m really hoping Bernard, that you can explain to us the importance of why you would want to track inventory in QuickBooks.
Bernard: Of course. First, you want to track inventory because inventory is a very valued asset.
- This is something you own and you want to be sure of what you have.
- Most importantly, you want to know how much you have so that when you have a customer order, you’re not going to be short of inventory.
- If you have an order and you can’t ship because you don’t have the product, then that’s a pure loss to you.
Conversely if you have too much inventory, then;
- You pay rent in a warehouse,
- The inventory gets to be dirty and obsolete, and
- You tend to be losing money
It is therefore very important to keep track of inventory, and QuickBooks is a great, great product to maintain what is called a perpetual inventory.
As you do your daily business in QuickBooks i.e you sell things, buy things; QuickBooks will automatically keep track of the quantities you have on hand and the value of your inventory.
Tracking Inventory in Different Locations
Interviewer: If you carry different types of inventory in a warehouse and in different locations, do you have to have a third-party software to track this and integrate that into QuickBooks?
Bernard: Usually not. QuickBooks has great in-depth inventory features. It does a lot of what you want to have done with inventory, especially for those businesses that have multiple locations or special needs such as keeping track of quantities by lot.
- Let’s say you are a food distributor or manufacturer, you may want to do a lot inventory or serial numbers.
- QuickBooks has a module called the Advanced Inventory that goes with Quick Enterprise that is really going to do a whole lot for you.
Generally speaking, unless you have a home-manufacturing operation that you want to account for, the QuickBooks inventory features will be very much sufficient for the great majority of our businesses.
What QuickBooks Features Are Needed?
Interviewer: Can we talk a little bit about different locations and how that might affect the ability to work with QuickBooks with different locations and keep track of that?
Bernard: Yes, you can. You must, however;
- Purchase the QuickBooks Enterprise version, which is a little bit more expensive; and not that much more expensive, and
- You need to subscribe to what is called the QuickBooks Advanced Inventory that has the multi-location feature.
Usually, if you’ve got multiple locations, the assumption is that your business will be a little bit bigger than just a mom-and-pop shop or a home-based business. It would therefore be natural to install QuickBooks Enterprise to use the QuickBooks Advanced Inventory.
How to Setup QuickBooks Inventory Tracking?
Interviewer: Is this something that’s fairly easy to setup for someone or does this take advanced knowledge and expertise?
Bernard: It is very easy to setup. It is like everything else; it might be deceptively easy.
- The QuickBooks software is easy to operate but generally speaking, we find that working with a QuickBooks Pro Adviser or seller is really beneficial to the use.
- We can’t really train and explain what the processes are and make sure that the users are using QuickBooks correctly; meaning receiving the inventory properly, setting-up the inventory list properly so that it all flows nicely and produces accurate results.
Interviewer: Wonderful. Thank you so much Bernard.
Bernard: You’re very welcome. Anytime.
We Are Happy To Help
You can contact us today to book a free consultation. We’d be happy to review your business’s inventory levels and then determine the best ways to use QuickBooks to consistently track inventory based on your business needs.