Managing accounting and inventory can be an overwhelming challenge for wholesale distributors.
Luckily, Xero accounting software offers an all-in-one solution to streamline distributor accounting and operations.
In this post, we'll explore how Xero can optimize inventory management, invoice creation, supplier payments, payroll, integrations, and more for wholesale distribution businesses, with insights into pricing plans and ROI.
Introduction to Streamlining Distributor Accounting with Xero
Xero is a cloud-based accounting software that can help wholesale distributors streamline their accounting processes and gain real-time financial visibility. By moving accounting to the cloud, Xero eliminates tedious paperwork and manual data entry, freeing up distributors to focus on their core business.
The Role of Xero Accounting Software in Wholesale Distribution
Xero is designed to support the unique needs of wholesale distribution companies. Key features relevant to distributors include:
- Integrations with ecommerce platforms like Shopify to automatically import orders and synchronize inventory
- Barcode scanning to quickly receive inventory and pick/pack orders
- Purchase ordering to easily reorder stock
- Dashboard insights into sales, cash flow, and other KPIs critical for distribution
By centralizing accounting processes and providing an up-to-date view of orders, inventory, and finances, Xero enables distributors to scale their operations efficiently.
Advantages of Online Communication and Real-Time Data in Xero
A major advantage of Xero's cloud technology is enabling real-time collaboration and data sharing. Distributors can give their accountant or bookkeeper access to view and manage financials in a centralized Xero organization. This facilitates:
- Online communication via activity logs and messaging
- Real-time visibility as data syncs automatically
- Remote, multi-user access from any device
With multiple users accessing up-to-date financial data in Xero, distributors can coordinate more effectively across teams to keep business flowing smoothly.
Navigating the Xero Dashboard for Business Insights
Xero provides distributors an at-a-glance view of their finances through its customizable dashboard. Key metrics displayed relate to:
- Cash flow status and accounts receivable
- Top-selling products and customers
- Sales and purchases activity
- Inventory value and turnover
Monitoring these KPIs daily helps distributors identify trends, issues, and opportunities early so they can continuously refine operations.
Can Xero handle inventory?
Xero has built-in inventory management features that allow you to track stock items, set reorder points, and generate purchase orders directly within the software. This can be useful for wholesale distributors to keep track of product inventory levels.
Here are some of the key things Xero's inventory management can do:
- Create inventory items for the products you buy and sell, including details like cost price, sales price, and reorder point
- Connect the inventory items to purchase orders, sales invoices, and item receipts to automatically update stock levels with each transaction
- View real-time quantities on hand and be alerted when stock reaches reorder points
- Generate purchase orders directly in Xero when inventory needs to be replenished
- Run inventory reports to analyze stock usage, turnover, and margins
In addition, there are Xero apps available that provide more advanced inventory management functionality tailored to wholesale distribution businesses. These integrate seamlessly with Xero and typically include features like:
- Multiple warehouse/location tracking
- Batch and serial number tracking
- Barcode scanning capability
- Advanced purchasing and sales order processing
- Automated stock transfers between locations
So while Xero provides basic inventory management out of the box, connecting an inventory app can give you more robust tools specialized for managing wholesale distribution operations. The apps help you track stock across multiple warehouses, generate pick/pack slips for order fulfillment, and sync seamlessly with Xero for real-time accounting of inventory transactions.
Can I use Xero for manufacturing?
Xero Inventory can be made to work for most small manufacturing businesses, even if certain advanced inventory management features are not available out of the box.
The key capabilities that Xero provides for manufacturers include:
- Track inventory quantities and values in real-time as goods are received and invoices are created
- Set up products with cost and sales price information
- Generate purchase orders to procure inventory
- Create sales invoices and fulfill orders
- Integrate with other systems via APIs to extend functionality
However, Xero does lack some specific manufacturing-oriented capabilities like:
- Handling back orders when out of stock
- Complex multiple pricing tiers
- Timing differences between stock levels and accounting transactions
So while Xero can cover the basics of inventory and order management, manufacturers with more complex needs may require an add-on manufacturing ERP solution.
The main deciding factors on if Xero is a good fit are:
- Size of the manufacturing operation - Smaller shops can likely meet all needs with Xero, larger ones may need more advanced software
- Complexity of manufacturing processes - Simple build-to-order businesses fare better than those with intricate supply chains and manufacturing stages
- App integration requirements - Xero offers an ecosystem of add-ons, but even those may not provide everything larger manufacturers require
In summary - Xero delivers on core financials and can handle basic inventory with some constraints. Manufacturers should assess if an integrated solution like Xero plus add-ons can fulfill all their requirements before deciding to adopt it.
Does Xero have stock control?
Xero offers several features to help businesses track inventory and manage stock levels. Here are some of the key capabilities:
- Inventory tracking: You can create detailed item lists in Xero to track stock on hand, unit costs, sales prices, and more. As you record invoices and bills, Xero automatically updates your inventory quantities.
- Reorder notifications: Set reorder points on inventory items, and Xero will notify you when stock gets low so you can reorder in time. This helps prevent stockouts.
- Barcode scanning: If you use barcodes to track inventory, Xero lets you scan item barcodes when receiving stock or adding items to sales orders. This simplifies data entry.
- Inventory reports: Review real-time reports on inventory value, stock on hand, item sales history, reorder items, and more to optimize your ordering.
So in summary, Xero provides robust inventory management and stock control suitable for most wholesale/distribution businesses. The automatic syncing with invoices and bills helps keep quantity data accurate without manual counts. And features like reorder notifications help you avoid losing sales due to stockouts.
What is Cin7 core?
Cin7 Core is the foundation of the Cin7 inventory management system, providing essential tools to manage operations and enable business growth.
Some key features of Cin7 Core include:
- Connected Inventory Performance: Integrates inventory data with other business functions like sales orders, purchasing, and fulfillment for a unified view of stock levels and movements. Provides real-time visibility and helps optimize decisions.
- Scalability: Cin7 Core can scale from small businesses up to large enterprises. The system grows with your business needs.
- Fundamental Tools: Includes core functionalities like stock control, warehouse management, order processing and fulfillment, purchasing and receiving, inventory and cost tracking, and reporting.
- Integration Capabilities: APIs allow integrating other business systems like ecommerce platforms, accounting software, shipping solutions etc. This saves manual work and improves data accuracy.
In summary, Cin7 Core gives you the basic building blocks to efficiently operate inventory and order fulfillment workflows while enabling data connectivity across systems for inventory optimization. It is designed to scale to meet the needs of diverse businesses.
sbb-itb-be9f1e0
sbb-itb-be9f1e0
sbb-itb-be9f1e0
Configuring Xero for Efficient Wholesale Distribution Management
Xero can be a powerful tool for managing wholesale distribution when properly configured. Here are some key steps distributors should take to optimize Xero:
Tailoring Business Settings in Xero for Distributors
- Enable inventory tracking and set up items/products in your item list
- Adjust invoicing settings like payment terms and branding to match your business
- Set up user permissions for staff to limit access as needed
To tailor business settings:
- Go to the Settings menu
- Click General Settings
- Adjust options like:
- Business name, addresses, logo, etc.
- Payment terms
- Inventory settings
- User permissions
How to Connect Business Bank Accounts to Xero
Connecting bank feeds allows transactions to automatically import into Xero.
To set up bank feeds:
- Go to Bank Accounts in Xero
- Click "Connect a bank account"
- Search for your bank, enter credentials
- Follow prompts to connect accounts
Now transactions from connected accounts will regularly import.
Optimizing Inventory Management and Reconcile Items in Xero
- Categorize inventory items with tracking enabled
- Set up purchase orders for suppliers
- Use Xero's reorder notifications for stock management
- Frequently reconcile items to match physical counts
Reconciling inventory:
- Go to Inventory
- Select an item
- Click Reconcile
- Enter counted quantity on-hand
- Xero will calculate variance
Regularly reconciling and tracking items this way keeps inventory data updated.
Mastering Distributor Accounting with Xero's Core Features
Xero provides a robust set of accounting features tailored to the unique needs of wholesale distributors. By seamlessly connecting with ecommerce platforms, automating workflows, and centralizing financial data, Xero helps distributors improve efficiency, cash flow, and insight across key accounting activities.
Creating and Managing Invoices in Xero for Distributors
Xero makes creating, sending, and tracking sales invoices simple by integrating with major ecommerce platforms like Shopify, WooCommerce, and Square. New orders from these platforms flow directly into Xero to generate invoices automatically.
Key benefits include:
- Auto-syncing new sales orders from ecommerce platforms to create invoices
- Customizable invoice templates
- Payment reminders and tracking overdue invoices
- Tools to reconcile accounts receivable
By streamlining the invoicing process, distributors can get paid faster and eliminate manual data entry.
Efficiently Handling Bills and Supplier Payments in Xero
Xero centralizes bills and supplier payments to help distributors take advantage of early payment discounts, avoid late fees, and simplify accounting.
Benefits include:
- Syncing bills and purchase orders from suppliers
- Setting up payment schedules and automated reminders
- Dashboards to track upcoming and overdue bills
- Tools to reconcile accounts payable
By connecting the procure-to-pay workflow in Xero, distributors can tightly manage cash flow.
Exploring Xero's Accounting Options for Wholesale Distribution
Xero offers a full range of accounting tools relevant to wholesale distributors, including:
- Custom chart of accounts setup
- Multi-currency support
- Inventory management
- Order fulfillment and tracking
- Sales tax calculations
- Financial reporting and dashboards
With robust accounting functionality tailored to wholesale distribution, Xero provides the visibility distributors need to simplify operations.
Payroll Options in Xero for Distributor Staff Management
Xero’s integrated payroll streamlines paying staff and contractors. Key features like:
- Easy setup for multiple pay schedules
- Automated salary payments
- Tax calculations and filings
- Payroll reporting and supervision tools
With tailored payroll options, distributors can efficiently manage staff costs and compliance.
Enhancing Distributor Operations with Xero Apps and Integrations
Xero offers a variety of apps and integrations that can enhance operations for wholesale distributors. These add-ons help streamline processes, improve efficiency, and provide valuable insights.
Selecting the Best Xero Apps for Wholesale Distributors
When selecting Xero apps, wholesale distributors should consider their unique operational needs. Useful app categories include:
- Inventory and order management: Track purchase orders, automate stock updates, and sync inventory across sales channels. Examples include Dear Inventory and TradeGecko.
- Shipping and fulfillment: Print packing slips, purchase shipping labels, and track deliveries automatically. Examples include ShipStation and Consignor.
- Reporting and data analysis: Gain insights with custom reports and dashboards for sales, expenses, inventory, and more. Examples include Fathom and Insightly.
- Customer relationship management (CRM): Manage customer accounts, communications, and sales pipelines. Examples include HubSpot CRM and Insightly.
- eCommerce: Connect online stores to sync orders, inventory, and other data with Xero. Examples include Shopify and Woocommerce.
When evaluating apps, distributors should consider cost, data security, ease of use, integration capabilities, and reviews from other users.
Integrating Xero with Project and Contact Options for Distribution
Xero's project tracking and contacts options can help distributors manage key aspects of their business:
- Track projects: Create projects for large distribution jobs. Assign contacts, track project stages, attach files, record billable expenses, and invoice clients. This provides oversight into profitability.
- Manage contacts: Organize key customer and vendor accounts with contact records. Log communications, attach documents, and link contacts to Xero invoices, bills, and other transactions.
- Automate workflows: Use Zapier, Workato, or IFTTT to connect Xero projects and contacts with other apps. Examples include creating project records from new distribution orders in Shopify or automatically logging communications in HubSpot CRM each time a Xero invoice is sent.
Integrating Xero's built-in features with apps helps distributors gain more coordinated insight into customer relationships, sales pipelines, and distribution project performance.
Understanding Xero Pricing for Wholesale Distribution Businesses
Xero offers several pricing plans tailored to the needs of wholesale distribution businesses. When evaluating the costs, distributors should consider number of users, invoice volume, and desired features.
Comparing Xero Pricing Plans for Distributors
The Starter plan provides basic accounting tools for small operations at $9 per month. The Standard plan at $30 per month offers features like quotes and purchase orders better suited for growing businesses. The Premium plan at $60 per month has advanced inventory, bill payments, and reporting.
For larger wholesale operations, the Enterprise plan provides consolidated financials, complex tracking, and custom integrations. Pricing starts at $180 per month with volume discounts.
When deciding on a Xero plan, distributors should evaluate expected monthly invoices and users. More users and invoices make the Standard or Premium plans better values.
Evaluating the ROI of Xero for Distributor Accounting
Switching to Xero can yield a positive ROI for distributors through:
- Reduced accounting labor costs by 30-50% through automation
- Faster order processing and invoicing leading to quicker payments
- Better cash flow visibility to improve financial decisions
- Inventory optimization from accurate, real-time reporting
- Overall boost in productivity across financial processes
The ROI timeframe depends on current systems, team size, and Xero plan. But most distributors switching from manual to cloud accounting see full payback within 6-12 months. Those moving from legacy solutions to Xero can achieve ROI within 3 years.
Conclusion: Optimizing Wholesale Distribution with Xero
Summarizing the Benefits of Xero for Distributor Accounting
Xero provides several key benefits for wholesale distributors looking to optimize their accounting processes:
- Real-time visibility: Xero gives you up-to-date financial data and reporting through its cloud-based software. This enables better cash flow management and financial decision making.
- Automated processes: You can connect bank accounts, reconcile transactions automatically, and streamline billing and invoicing. This saves significant time and effort compared to manual data entry.
- Collaboration: The cloud-based software facilitates collaboration between team members through shared access and online communication tools. This improves workflow efficiency.
- Scalability: Xero makes it easy to add users and integrate with other business apps as you grow. The flexible, modular system grows alongside your wholesale distribution business.
- Affordability: Xero offers very competitive subscription plan pricing for the features and capabilities provided, especially when replacing legacy on-premises accounting systems.
By leveraging these advantages, Xero empowers distributors to enhance financial oversight, reduce operating costs, and set their business up for scalable success.
Future-Proofing Your Distribution Business with Xero
As a leading cloud accounting platform, Xero invests heavily in improving and expanding its software capabilities. With regular updates and new app integrations, it ensures customers have access to the latest tools and technology.
For wholesale distributors, this means you can future-proof your business systems with Xero. As innovations emerge in inventory management, ecommerce, predictive analytics, and more, Xero aims to support integrating these solutions into its platform.
Rather than relying on legacy solutions, wholesale distributors can leverage Xero's continuous improvements to stay competitive. The platform scales alongside emerging technologies to meet modern accounting demands.
With Xero, distributors gain assurance that their financial management will evolve to support future growth and success in an increasingly digital business landscape.
