Best Inventory Management: Review of the Big 3 in Accounting Software. Effective inventory management is one of the most critical functions an accounting software performs in business operations. However, many businesses frequently get it wrong when selecting accounting software. An understanding of the comparative advantages offered by the prominent software in the market is necessary. This will enable the organization to make an informed purchasing decision on the best inventory management system for your business.
Three accounting software’s will be reviewed here and these have been selected on the basis of efficiency and consequent prominence in the market. These solutions include AccountingSuite, QuickBooks Online and Xero. For any business that creates or sells product, inventory tracking is essential. To ensure the best integration with the accounting software, it is ideal that the inventory management system be built into the accounting application rather than an add-on. Additionally, if included, the cost savings are exponential. The basic features of an efficient inventory management system must be established before delving into an analysis.
Inventory Management System Features:
- Tracking on-hand quantity for the most critical inventory items
- Ability to integrate with the business’ accounting system without dual entry
- Setting and adjusting quantity and value of inventory items
- Simple yet effective reporting system for items indicating current quantity, value, # purchased and sold within a specific timeframe
- Sales and receipt transactions
Best Inventory Management
AccountingSuite was built with inventory management in mind. This highly organized platform suits businesses with well-tuned processes. Small businesses, therefore, stand to gain from its relative novelty in the marketplace. Using the above list of basic features, this is how AccountingSuite stacks up:
- Tracking inventory is available to all categories of users. There is no segregation in this functionality
- The inventory feature is built right into the software. No add-ons are required for this feature to function
- AccountingSuite allows users to make required adjustments in quantity even after items are received
- The software’s reporting system is extensive and this includes the inventory stock status by item report
- Sales and receipt transactions are also available within AccountingSuite. Real-time inventory and item receipts are standard functions
- Class Tracking and Reporting
- Sales by Item Report
- Open Sales Order by Item Report
- Quantity on Hand Location Report
- Inventory Stock Status by Item Report
- Open Purchase Orders by Item Report
- Purchases by Item Summary Report
- Universal Report
AccountingSuite has three packages: Entrepreneur, Small Business and Premium. The respective prices are $15, $29 and $49 all charged monthly per company. The major differences between these packages is the number of active users. The software permits one, five and ten active users respectively.
QuickBooks™, like many other small business accounting software solutions, focuses mainly on service businesses. Again, using the earlier listed parameters, this software is examined hereunder.
1. Quantity-on-hand is trackable only by subscribing to a higher version of the software, QuickBooks Online Plus.
2. The inventory management feature is an integral part of the software so, it requires no further integration.
3. Quantity and value can be set when receiving the item but subsequent adjustment of item value after entry is not permitted.
4. While reports are generally available, there is limited flexibility and many restrictions on inputs that reflect the peculiarities of individual businesses.
5. Sales and receipt transactions are readily available within QuickBooks in addition to updates.
Business Performance Reports
Customizations including summarization or listing of accounts within a group and formulas etc.
While QuickBooks is a versatile software, it is obviously lacking in many areas. Tracking inventory is a major example as it requires an upgrade to the Plus version. This adds $9.30/month on top of the base software costs.
Xero only added its inventory feature in 2015 after years of expectation by its users. Since then, it has tried to evolve to meet customers’ changing demands. In analyzing its inventory management feature, it will be stacked up against the five parameters listed earlier.
1. Tracking inventory is available to all categories of subscribers, not just those paying more
2. The inventory feature is a built in component of the software platform. Therefore, it requires no external add-on to function
3. Xero permits users to make adjustments in quantity even after receipt. Additionally, the value of inventory by using its re-evaluation adjustment function
4. The software’s filters are limited in scope and function while its inventory-related reports are also limited in detail.
5. Sales and receipts are readily available
Customizations including accrual or cash, adding sub columns, displaying row/column data by totals, time frames, customers and products etc.
Create Report Groups
Xero offers three packages for users. Starting with the Starter plan priced at $20/month, users can upgrade to the Standard plan at $30/month and finally, the Premium plan at $40/month. Xero inventory add-on will cost $ extra per month.
Having analyzed the three software solutions, it is now time to call a verdict. It must be emphasized that their target market typically comprises small businesses. QuickBooks and Xero are better known in the market yet possess very restrictive functionalities. As a comparatively new entrant in the accounting technology ecosystem, AccountingSuite has had the opportunity to assess the pain points of business owners with inventory management needs and tailor the software to include the major functionalities required. The main differentiator, therefore, is its comprehensive inventory system innately built into the accounting software. Due to the following functionalities, AccountingSuite is the clear winner for businesses who need to track inventory:
Real-Time Inventory by Category and Location
Track Inventory by Project and Costs
FIFO and Weighted Average Costing by Item
UPC, Custom Fields and Vendor Item Number
Assembly/Bill of Material including SubAssemblies
Return Management (Sales and Purchase)
Advanced Unit of Measure Conversion
Advance Pricing Matrix
Item Receipts and Shipments
To learn more, visit www.accountingsuite.com.