Inventory Management using Quickbooks and Excel
Part 2 of 3
You can read Part 1 here.
Quickbooks does not offer a robust or powerful tool for tracking inventory. But for a small business, doing Inventory with Quickbooks may be all you need.
Utilizing the item, sub-item and the inventory part or inventory assembly features you can have complete inventory control.
Quickbooks offers benefits such as being:
Simple, easy to use. This would be a big benefit to small businesses where the inventory management position was not a full time job or the inventory management person also had other duties that were taxing and you need something that was efficient as well as sufficient.
Enough tracking flexibility to easily manage small business inventory demands. You can quickly run up against when using the Item list for your Inventory managment but if you are not looking for fancy and sophisticated this shouldn’t cause Quickbooks to completely fail at meeting your needs.
Able to handle Lot tracking. By utilizing sub-items you can use Quickbooks for lot tracking. This will also give you visibility on price changes over time as well as keep reports accurate since you will not be updating cost on one item which erases previous prices.
Already a part of your accounting software. This allows you to have all your info, Purchase Orders, Customer Invoices, Vendor Information and Inventory Center on one interface.
Some of the downsides of doing your Inventory with Quickbooks:
When you are using the sub-item feature for lot tracking you will create a new sub-item for one parent item as frequently as each time you order a different lot/batch depending on how detailed you do your Inventory tracking. This will lead to multiple items under one name causing your company file to become prematurely bloated. I have heard of servers overloading after the file becomes larger than 1 Gb but other systems easily handle files as large as 4 Gb.
Even though Quickbooks offers a reorder point reminder I have not found it to be sufficient in all cases.
In my opinion Quickbooks (as it is now) isn’t going to be all you will ever need. But it will more than handle all your inventory needs from startup through your first few years of growth.