Tracking Products and Services in QuickBooks Online, Part 2

Last month, we explored the process of creating a product record. (Read the blog post here.) Now we’ll look at where they’re used in QuickBooks Online.

Have you been able to create records for all of your products and services? If you have a large inventory, this can be a time-consuming process. But we recommend that you build complete records, even when you create them as you need them. This is critical if you plan to track inventory items.

You’ll use your product and service records in several areas of QuickBooks, including invoices and estimates, purchase orders, and sales receipts. There’s also an entire set of reports dedicated to products and inventory.

If you’ve tried creating Inventory Items in QuickBooks Online but have only been allowed to set up Services or Non-Inventory Items, you missed a step when you were completing your Company Settings. Click on the gear icon in the upper right (next to your company name), then on Settings | Company Settings. Click on Sales in the left vertical tab to see the Products and services section. If any of these three options is turned off, click in the box to turn it on.

This is one of the reasons we recommend that you let us help you set up QuickBooks Online, even if you’re transitioning from the desktop version of QuickBooks. If you don’t visit every area of Company Settings and designate your preferences, you may get frustrated and think that the site isn’t capable of doing everything you need.

Using Your Records

You’ll see why it was so important to build a thorough set of product and service records when you start to enter data in transaction forms. Assuming that you’ve also created records for your customers and vendors, filling out an invoice, for example, is mostly just a matter of selecting the correct options from drop-down lists.

Even if you have a comprehensive set of records, you’ll certainly take on new customers and vendors, and start offering additional products and services down the road. When this occurs, or if you didn’t complete your setup work because you absolutely had to start entering transactions, you can add items as you need them.

Once you’ve selected a customer and either accepted the default terms and dates or edited them to reflect your needs, you’ll click on the arrow to the right of the first field in the body of the invoice, as pictured in the example above. You can scroll down and find the item that the customer wants to purchase in the list that drops down or click on +Add New.

If you do, the Product/Service information panel will slide out from the right. You can then create a record for the product or service, like we wrote about last month.

A Running Tally

Here is another reason why it’s so important to be conscientious about completing product records. When you enter that number in the Initial quantity on hand field, QuickBooks Online uses that as a starting point for tracking your inventory levels. Every time you process a form indicating that you’re selling x number of widgets, the site subtracts that from the most recent total.

When you click in the Quantity field, a bubble opens above it. This tells you how many units are currently available. It keeps you from selling items that you don’t have. This field also indicates when you may have too much of a product, and if it’s not selling quickly.

Unless you have a very small product list, you may not recognize overstock. QuickBooks Online offers several reports that can help you track your inventory. Click on Reports in the left vertical tab, then All Reports, then Manage Products and Inventory to see what’s available.

Setting up QuickBooks for a successful launch can be challenging. So can the concepts involved in tracking your inventory. We’re always happy to help with either process – or both. Call us at (801) 225-6900 for help.