It is well-known that online accounting makes the otherwise tedious accounting process hassle-free thanks to the almost automated invoicing, quoting and expense management, time tracking options and auto-generated business reports.
However, since every business sells something, whether it is a product or a service, they need to keep track thereof in the most effective way possible.
This is where inventory comes into the picture: this way you can easily manage the items and services you are selling, store the contact info of vendors you are purchasing said items from and create invoices/quotes etc. To make things even better, the best online accounting solutions have built-in inventories, but if they don’t, you can take advantage of their API support and integrate the best third-party inventory apps or ecommerce solutions of the market to create a fully automated system, so you can spend your time running your business.
Inventory Features in Accounting Software
Essentially, an inventory is an advanced spreadsheet in which you can store the quantity of the products/services you sell, along with other data such as their price, cost etc. In fact, some accounting solutions even allow you to use actual Excel sheets and import them into the software, turning it into more than just a plain document. An inventory, which keeps track of your items in real-time, can highlight current stock levels and your best selling products, showing you the profit margin to make future business decisions accordingly.
However, the main reason why an inventory is more than just a database is that it can speed up data entry to previously unseen extent. You can not only create invoices and quotes based on what you have in your inventory in a jiffy, but you can also separate items you want to sell and buy. Moreover, this separation can go one step further by choosing not to track your items, which comes in handy if you are selling services that doesn’t qualify as countable.
Best Online Accounting Software of 2019
Integrating Third Party Inventory Solutions
Aside from payroll, inventory is one of the black sheep of cloud-based accounting, as it is often not present as a full-fledged feature. However, thanks to the support and offering of an API, most accounting solutions allow users to integrate third-party apps, like TradeGecko, into their accounting software. This way you can add an inventory to the mix with which you can manage bigger “warehouses” than the ones built into the accounting programs. This especially comes in handy if the integrated software is an ecommerce solution, since the moment a customer purchases something through the ecommerce site, an invoice is automatically created and the bank feed you see in your accounting software is updated.
Another suitable solution is Vend, a popular POS with inventory feature uses: it sends all data needed for accounting after each register closure, and even creates invoices for business reporting purposes (a feature working vice versa as well). The same two-way compatibility is also the case for contact management: they can feature in both Vend and your accounting software.
Integrating Xero and TradeGecko
Integrating TradeGecko into QuickBooks Online
Vend POS and Xero
Using Vend POS and QuickBooks Online Together
Recommended Online Accounting and Inventory Software
As we said before, inventory management is a feature not all cloud-based accounting software has; however, thanks to the support of an API, it is possible to at least integrate existing inventory solutions into your accounting program. But sometimes both solutions are available, as is the case with the following two accounting programs, Xero and QuickBooks Online.
The trustworthy software of over 600k SMBs, sole proprietors and enterprises, Xero has everything a business owner needs, including a pretty basic, but overall useable inventory tool. In Xero you can build your inventory from scratch or you can bulk import a large quantity of data from previously created spreadsheets, and make each item untracked (for services), tracked (for products) or both. Xero is capable of displaying real-time stock levels and values, average purchase costs and the quantities of items, which you can immediately use should you need to create a quote/invoice (even with pictures attached thereto for reference) or when you want to refill your inventory. Furthermore, Xero highlights your best selling items, so you can focus on the product that makes you the biggest profit.
To make things better, inventory is part of each Xero subscription (starting from as low as $6.30 per month for the first 6 months of use), but you can replace or complement it anytime with one of the 500 third-party apps like the aforementioned Vend, TradeGecko or even TidyStock, Stitch Labs, and Stock & Buy.
A strong competitor of Xero, QuickBooks Online is another great cloud-based accounting solution that also offers inventory management for small business owners. The inventory sports such unusual features as custom images, with which you can check your available items at a glance, and auto-generated and continuously updated product lists with which you can finish business reporting faster. Like in the case of all built-in inventories, this one also automatically updates whenever a purchase is made and it displays in such a way you can distinguish your best/worst selling products and those items that are in need of refilling. Speaking of refilling, QuickBooks is also capable of keeping track of those items you have ordered and it lists said products/services according to vendors you are in contact with. Naturally QuickBooks allows you to integrate various third-party inventory apps into your accounting solution, including TradeGecko, Stitch Labs, SOS Inventory and Boxstorm, or even Salesforce, Hike POS and many more.
Keep in mind, however, that the built-in inventory is only available in the top pricing plan of QuickBooks Online (called Plus), which is $28 per month for half a year should you not take advantage of the 30-day free trial.