Managing inventory efficiently is a persistent pain point for most accountants.
But having the right inventory management software can make all the difference for an accounting firm or small business client.
In this comprehensive review, we will cover the top inventory management systems available today, along with critical features to look for and detailed insights on utilizing these tools to enhance inventory tracking, reporting, and overall efficiency.
Introduction
Inventory management is crucial for accountants to track assets, ensure accuracy of financial reporting, and advise clients on optimizing inventory costs. As businesses grow, manual methods become inefficient and prone to errors. Implementing a modern inventory management system tailored to accounting workflows allows gaining real-time visibility, minimizing write-offs from shrinkage/spoilage, enabling efficient audits, and providing data to optimize inventory levels.
When evaluating inventory software, accountants should look for key features like:
- Integration with popular accounting software like QuickBooks Online and Xero to maintain updated ledger entries as inventory changes
- Barcode scanning for tracking inventory in/out in real-time
- Robust reporting on inventory valuation, asset tracking, and cost of goods sold
- Custom fields to track details like batch/lot numbers, serial numbers, and expiration dates
- Multi-location tracking to manage inventory in various warehouses, retail stores etc.
- Purchase order generation and tracking for efficient reordering
- Sales order management and allocation to ship inventory efficiently
Top-rated solutions like Fishbowl provide tailored capabilities for accounting professionals managing manufacturing, distribution, eCommerce, retail and service operations. With available modules for manufacturing, barcode scanning and more, Fishbowl serves as an end-to-end solution for managing inventory workflows and tying to accounting.
Evaluating leading solutions against accounting-specific inventory requirements helps determine the right platform to enhance accuracy, save time on routine tasks, and provide clients with actionable data to optimize their operations.
Which software is recommended for doing the inventory management?
Vintti focuses on providing businesses with specialized accounting and finance talent. As such, inventory management software tailored for accountants can streamline processes and provide valuable insights.
When evaluating inventory management solutions, key aspects for accountants include integration with popular accounting platforms, powerful reporting tools, and advanced features like multi-location tracking.
Based on these criteria, here are top recommendations:
Cin7 stands out as the best overall inventory management software for accountants. It seamlessly integrates with Xero, QuickBooks Online, and other major accounting solutions. Robust reporting provides real-time visibility into stock levels, sales data, and more. The software also enables tracking inventory across multiple warehouses.
inFlow is another great option, especially for B2B companies. It connects to accounting software and contains useful features like batch tracking and serialized inventory. This simplifies managing inventory for manufacturing, distribution, and other B2B scenarios.
Lightspeed Retail shines for retail stores needing a complete point of sale and inventory management solution. It provides deep integration for accounting platforms along with advanced capabilities like omni-channel fulfillment and customer loyalty programs.
For restaurants and hospitality businesses, Upserve delivers an integrated inventory solution catered specifically for the industry. It combines a full POS system with menu management, food cost tracking, purchasing workflow, and more.
The above solutions help accountants efficiently track inventory while connecting data to vital accounting and reporting functions. For most accounting professionals, Cin7 stands out as the most versatile and fully-featured inventory management software. But inFlow, Lightspeed Retail, and Upserve also deliver robust capabilities tailored for B2B, retail, and restaurant scenarios respectively.
What are the 4 types of inventory management system?
Inventory management is critical for businesses to track stock levels and optimize operations. There are four major inventory management methods, each with their own pros and cons:
Just-In-Time (JIT) Management
The just-in-time (JIT) method focuses on only keeping enough inventory on hand to meet immediate production needs. Benefits include:
- Reduced storage and handling costs
- Less wasted inventory from spoilage/obsolescence
- Improved cash flow from reduced inventory carrying costs
However, JIT requires predictable demand and excellent supplier relationships to avoid stockouts. It's best suited for companies with steady sales.
Materials Requirement Planning (MRP)
Materials requirement planning (MRP) uses sales forecasts and lead times to plan future inventory needs. Benefits include:
- Increased efficiency through better production planning
- Reduced chance of material shortages
But MRP depends heavily on forecasting accuracy. Errors can lead to overstocking or shortages. It also requires significant data inputs.
Economic Order Quantity (EOQ)
The EOQ model balances inventory carrying costs against order costs to optimize order size. It can help businesses minimize total inventory costs. But the EOQ method relies on predictable, constant demand.
Days Sales of Inventory (DSI)
DSI measures the average number of days a business can sell through stock on hand. While not a full management method, DSI helps gauge inventory performance. Lower DSI frees up cash flow but may increase stockouts.
In summary, the right inventory management approach depends on the business' specific needs and challenges. Combining DSI benchmarks with JIT, MRP, or EOQ methods can optimize overall inventory efficiency.
Does QuickBooks have an inventory management system?
Yes. QuickBooks Desktop Enterprise offers warehouse inventory management features that track movement and storage of products and materials. Features such as lot tracking, bin tracking, and serial number tracking make it easy to locate inventory quickly and accurately across your locations.
QuickBooks enables businesses to keep an accurate count of inventory quantities on hand. It integrates with barcode scanners to simplify product tracking as inventory comes in or moves out. The software also provides inventory valuation methods like FIFO, LIFO, or average cost to properly account for the value of inventory.
With QuickBooks, accountants can gain real-time visibility into inventory levels and movements. This helps ensure sufficient stock is on hand to meet customer demand while minimizing excess inventory carrying costs. The software generates inventory reports that provide insightful data to help accountants advise clients on optimizing inventory management.
By leveraging QuickBooks' inventory tracking capabilities, accountants can more efficiently perform periodic inventory observations for their clients. The detailed records in QuickBooks reduces the effort needed to verify inventory existence and properly value it on financial statements. Overall, QuickBooks' inventory system gives accountants robust tools to better manage clients' inventory processes and reporting.
What is inventory management accounting software?
Inventory management software helps businesses efficiently track stock levels and optimize daily operations. By automating manual processes prone to human error, inventory management systems improve data accuracy and reduce carrying costs.
There are a few key features that set inventory management solutions apart:
Real-time tracking
The best inventory management software integrates with point-of-sale systems and barcode scanners to provide real-time inventory tracking. As items are sold or added to stock, the changes sync across the system immediately. This prevents overselling products that are out of stock and gives an accurate picture of current inventory.
Automatic reordering
Inventory software can automatically generate purchase orders and reorder items once stock falls below predefined levels. This ensures adequate inventory is always on hand to meet customer demand.
Reporting
Robust reporting functionality allows managers to identify fast/slow-moving items, detect shrinkage or waste early, pinpoint inventory cost drivers, and make data-driven decisions to optimize stock levels. Common reports include inventory valuation reports, stock level reports, and inventory turnover rate reports.
By implementing a centralized cloud inventory management software, businesses can maximize efficiency, minimize waste and carrying costs, and free up staff to focus on more productive tasks. When integrated properly, inventory management systems become an invaluable asset for supporting operations and facilitating growth.
Essentials of Simple Inventory Management Software for Accountants
Inventory management is a critical aspect of financial accounting. As an accountant, having visibility into your inventory data allows you to produce accurate financial statements and ensure proper tax compliance. In this section, we'll explore easy-to-use inventory software features that simplify these accounting tasks.
Financial Reporting and Simple Inventory Tracking
Connecting your inventory system to your financial data is essential for accountants. Inventory software with robust reporting functionality enables you to:
- Track inventory value changes over time to recognize Cost of Goods Sold (COGS). This impacts your Profit & Loss statement.
- Monitor inventory turnover, item profitability, stock levels, and other KPIs that provide insights into business performance.
- Maintain a perpetual inventory system for continuously updated stock counts, allowing for more accurate financial statements.
Choose software that seamlessly integrates with your accounting platform like QuickBooks or Xero. Automatic syncing of purchase orders, invoices, item receipts, and delivery logs will keep inventory data current for reliable financial reporting.
Prioritize simple, intuitive inventory management interfaces to minimize accounting workload. Barcode scanning, batch tracking, reorder point alerts, and warehouse management features also provide ease-of-use for managing stock.
Simplifying Tax Compliance with Automated Inventory Tools
Inventory software can greatly simplify tax preparation for accountants. Solutions with robust classification tools, stock value calculations, and reporting aid compliance in key areas:
- Inventory type classification - Classify inventory as raw materials, work-in-progress, finished goods to determine appropriate tax accounting methods like LIFO or FIFO.
- Cost basis tracking - The inventory's cost basis is needed to calculate profits/losses. Software that integrates purchase invoices provides reliable cost data.
- ** Historic reports** - Prior years' inventory activities needed for tax prep are easily accessible in most inventory platforms. Filterable reporting simplifies data analysis.
By centralizing inventory data and automating calculations for stock value, movements, and other metrics, accountants can more easily produce the detailed records required for tax season. This removes manual work while minimizing compliance risk and penalties.
When evaluating solutions, prioritize robust inventory analytics and transparency into tracking details for each item. Powerful reporting and drill-down capabilities will further ease the preparation of accurate tax documents regarding your stock holdings.
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Critical Features of Inventory Software for Small Business
Inventory management is a crucial component of any small business, enabling accountability of products and assets to facilitate informed decisions. As accountants serving small business clients, having visibility into accurate inventory data is key. To properly advise our clients, we must understand their day-to-day inventory workflows and how to choose software that scales with evolving business needs.
Here we highlight some inventory management features that provide particular value for accountants and small businesses, with an emphasis on ease of use and flexibility.
Barcode Scanning for Efficient Inventory Management
For physical products, barcode scanning improves the speed, accuracy and efficiency of routine inventory management workflows like:
- Physical inventory counts
- Cycle counting
- Warehouse picking/packing
- Goods receipts
- Inventory transfers
- Goods shipments
By reducing manual data entry errors and delays, barcode scanning allows for more frequent inventory visibility, lowering the risk of stockouts or carrying excess inventory.
Most modern inventory software solutions have mobile apps supporting barcode scanning via a smartphone or dedicated mobile device. This enables scanning inventory items directly on the warehouse floor rather than jotting information down on paper and transcribing later.
Some examples of mobile barcode scanning improving inventory workflows:
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Scanning product IDs during a physical inventory count for faster, more accurate results showing what is actually on hand. This avoids gaps due to missed items or transcription errors from manual approaches.
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Setting cycle count thresholds so the system automatically prompts when to scan certain items, ensuring consistent visibility into top products.
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Picking/packing orders efficiently by scanning barcodes on pick lists and product packages to confirm item and quantity accuracy.
Easy barcode scanning is hugely impactful for small businesses managing physical inventory. It pays dividends in time savings, workflow efficiency, data accuracy and inventory visibility.
Adaptable Inventory Costing Methods for Diverse Needs
Inventory software used by small businesses should support various costing methods like:
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FIFO (First In First Out) - Assumed older inventory is sold first, newer inventory remains. Values newest inventory higher.
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LIFO (Last In First Out) - Assumed newer inventory is sold first, older inventory remains. Values older inventory higher.
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Average Cost - Distributes cost evenly across units according to cumulative average.
Applying the appropriate method provides more accurate financial reporting on Cost of Goods Sold (COGS) and inventory value for balance sheet visibility.
Certain industries tend to prefer specific approaches:
- Retail/distribution - FIFO costing
- Oil/gas manufacturers - LIFO costing
- Consumer goods companies - Average costing
But small businesses can have unique needs or constraints, so having the flexibility to assign costing methods at the product level is advantageous.
Beyond supporting different techniques, inventory software should provide easy visibility into how inventory is being valued at any point in time. This includes tracking cost adjustments like:
- Currency exchange fluctuations
- Landed costs (duties, freight fees, insurance)
- Inventory discounts
Understanding how software calculates inventory value enables us to confirm proper COGS accounting and advise clients on optimizing margins.
The key is inventory software that readily adapts to each small business’ environment rather than taking a one-size-fits-all approach. The system should automate routine costing activities while providing flexibility and transparency as needs evolve.
Leveraging the Best Cloud Inventory Management Software
Inventory management is a critical function for most businesses. As an accountant, having real-time visibility and control over your clients' inventory levels, values, and cash flow is essential. In today's digital era, cloud solutions offer significant advantages when it comes to managing inventory efficiently.
Cloud-based inventory software provides anytime, anywhere access to stock information via the internet. This enables accountants to view up-to-date inventory metrics and data to make informed decisions for their clients. Additional benefits include automated workflows, mobile device support, security, scalability, and more.
When evaluating inventory management systems, key aspects to consider include:
Seamless Order and Purchase Management in the Cloud
Managing purchase orders and stock replenishment efficiently is vital. Cloud-based inventory software offers seamless integrations with sales channels, suppliers, and shipping carriers to fully automate these processes.
Key features accountants should look for include:
- Automated reorder points to trigger purchases based on minimum stock levels
- Integration with sales channels like Amazon, Shopify, etc. to update stock counts
- Purchase order generation and tracking
- Integration with shipping carriers to print labels, tracking numbers, etc.
- Payment processing integrations to pay suppliers
- Receive stock updates across integrated channels
Automating these repetitive manual tasks frees up significant time for accountants. It also minimizes human errors that can impact purchase costs, inventory accuracy, and ultimately profits.
Cloud Analytics and Reporting for Informed Decision-Making
Making data-driven decisions about inventory requires access to metrics like stock levels, inventory value, turnover rates, loss/waste, profits, etc. Cloud software enables comprehensive real-time reporting and analytics of this information.
Benefits of cloud-based analytics and reporting include:
- Customizable dashboards to view key inventory metrics and KPIs
- Graphs and charts to visualize trends
- Automated reporting for stock takes, profits/losses, turnover rate, waste, etc.
- Identify fast/slow-moving products and optimize stock levels accordingly
- Track inventory performance by location, season, events, etc.
- Data exports to analyze further in Excel, Power BI, etc.
With these cloud capabilities, accountants can benchmark inventory performance and advise clients on profit optimization strategies backed by accurate data. This is invaluable for small businesses lacking expertise in this area.
In summary, cloud inventory solutions offer indispensable advantages for accountants through real-time visibility, automated workflows, robust reporting, and ubiquitous access. Evaluating options based on order/purchase automation and analytics capabilities is key to leveraging the best platform for your inventory accounting needs.
Inventory Management Software Open Source Options
Open-source inventory management software provides a customizable and cost-effective option for accounting firms looking to efficiently track inventory. As these systems are open-source, the code is freely available for modification to suit a company's specific needs.
Benefits of Open-Source Inventory Management Systems
Open-source inventory management systems offer several key benefits:
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Customizability: The open-source code can be modified as needed to add new features or tweak existing functionality. This allows the software to be tailored to an accounting firm's unique requirements.
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Cost-effectiveness: As open-source software has no licensing fees, it eliminates this significant cost. There are still costs for implementation, maintenance, and support, but overall costs are lower.
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Transparency: The publicly available source code allows users to vet the software for security issues or bugs. This transparency enables higher confidence and trust.
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Flexibility: Open-source software is not dependent on a vendor product roadmap. Companies can change the code to upgrade capabilities on their own timeline.
Top Open-Source Inventory Management Systems
Some top open-source inventory management systems worth evaluating include:
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inFlow Inventory: A full-featured cloud-based system supporting multi-warehouse inventory tracking, barcode scanning, order management and more. It can integrate with accounting software like QuickBooks.
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Stockpile: A self-hosted system providing detailed inventory history tracking and reporting. It offers custom fields to capture specialized data.
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PartKeepr: A PHP/MySQL-based system offering extensive categorization and part grouping capabilities for large inventories.
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OpenBravo: A modular system providing basic inventory and warehouse management capabilities alongside other supply chain modules like procurement and billing.
Key Considerations for Implementation
When implementing open-source inventory software, accounting firms should consider:
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Carefully evaluating required features and system capabilities upfront to pick the best software match. Getting the requirements right is crucial for a successful implementation.
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Budgeting for any customizations, such as modding the source code or building integrations with other software platforms like accounting or ERP systems. These tasks require technical resources.
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Developing a transition plan mapping inventory data migration from any legacy systems and timing training to minimize business disruption. Gradual phase-in options should be explored.
Overall, open-source inventory management delivers flexibility and customizability at an affordable price point for cost-conscious accounting firms. Aligning software capabilities with well-defined inventory management requirements and processes is vital for realizing the full benefits.
Fishbowl Inventory: An In-Depth Case Study
Overview
Fishbowl Inventory is a popular cloud-based inventory management software tailored for small and mid-sized businesses. Known for its specialization in manufacturing and wholesale/distribution industries, Fishbowl offers robust functionality for inventory control, order management, purchasing, and shipping processes.
As an industry-leading solution for accountants, Fishbowl stands out with its deep integration with QuickBooks Online and Desktop. This makes Fishbowl a great choice for accounting professionals managing inventory for clients using Intuit's accounting software.
In this case study, we'll analyze key aspects of Fishbowl Inventory to understand why it's an excellent fit for accountants and their small business clients:
Seamless Integration with QuickBooks
One of Fishbowl's biggest value propositions is its seamless integration with QuickBooks using the Fishbowl QuickBooks Sync. This bi-directional sync automatically keeps inventory transactions updated between the two systems in real-time.
As soon as a sales order is fulfilled or purchase order received in Fishbowl, the corresponding accounting transactions are created in QuickBooks without any manual data entry. This saves accountants significant time and effort in managing inventory transactions across both systems.
With Fishbowl's advanced inventory features such as barcode scanning, bill of materials, and order management working behind the scenes, accountants can rely on QuickBooks to handle all accounting records including invoices, bills, item lists, accounts payable/receivable, etc. This is hugely beneficial for accountants already using QuickBooks for their clients.
User-Friendly Interface and Robust Functionality
Fishbowl Inventory strikes an excellent balance between usability and powerful features. With an intuitive dashboard showing KPIs like on-hand values and margin, users can gain quick insights into inventory health.
While Fishbowl offers advanced functionalities like serial/batch tracking, barcode scanning, bill of materials, and dropshipping management, the interface remains clean and simple to use. Role-based access control also enables granting selective permissions to employees.
Such well-rounded inventory management capabilities, combined with ease of use, make Fishbowl a great choice for accountants to recommend to their small business clients. Implementing Fishbowl can significantly simplify inventory processes and provide the level of control and visibility that fast-growing businesses need.
Affordable Pricing for Small Businesses
Unlike many other solutions catered towards larger enterprises, Fishbowl Inventory offers flexible plans at affordable rates for small businesses.
In fact, pricing starts at $200 per month for unlimited users with all features included. Volume-tier discounts are also available for larger inventories bringing down costs even further.
Such cost-effective pricing makes Fishbowl Inventory accessible even to smaller wholesale, manufacturing, ecommerce businesses with tight budgets. For accountants serving these clients, Fishbowl presents an attractive inventory management option.
Conclusion
With features like barcode scanning, bill of materials, order and purchasing management, Fishbowl Inventory excels at simplifying complex inventory workflows. Deep integration with QuickBooks Online/Desktop saves accountants significant time and effort in managing inventory transactions.
An intuitive interface, advanced functionalities, volume-tier discount pricing all make Fishbowl Inventory a great choice. For accountants supporting manufacturing and distribution clients that need robust inventory control, Fishbowl is worth strong consideration.
Top Inventory Management Systems for Accountants
Inventory management is crucial for accountants to track assets, properly value inventory, and provide clients with accurate financial reporting. As such, having a robust inventory management system tailored to accounting needs is essential. In this section, we review some of the top solutions on the market for accountants based on key selection criteria.
Comparison Overview
When evaluating inventory management systems, accountants should consider the following:
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Pricing: What is the total cost of ownership including license fees, support costs, and additional charges for premium capabilities? Ensure the system has capabilities matching your budget.
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Core accounting capabilities: Does the system connect to popular accounting platforms? Can it track inventory value changes and produce financial reports?
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Barcode and serial number tracking: This enables detailed monitoring of inventory items.
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Multi-location tracking: Useful for accountants managing inventory across warehouses, retail stores, etc.
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Manufacturing tools: Critical for accountants in manufacturing industries to track builds, kits, components, and bills of material.
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Simplicity and ease of use: As accountants are not inventory managers, the system should not have a steep learning curve.
With these criteria in mind, below we review some top solutions on the market.
Fishbowl
Fishbowl Inventory is one of the most popular options among accountants, offering robust capabilities tailored to accounting professionals.
Pricing
Fishbowl offers both cloud and on-premise options. Pricing starts at $999/user for the starter cloud package. More advanced packages are available for additional fees.
Core Accounting Capabilities
- Seamlessly integrates with QuickBooks Online and Desktop.
- Tracks inventory value changes and produces over 30 accounting reports.
- Provides real-time visibility into inventory assets and their accounting impact.
Barcode and Serial Number Tracking
Supports barcode labels and serial/lot tracking for detailed monitoring of inventory.
Multi-location Tracking
Enables tracking across unlimited warehouses and locations. Location-specific details like inventory value and quantity on hand are readily available.
Manufacturing Tools
Offers bill of materials, work orders, and other tools for manufacturers.
Simplicity and Ease of Use
User interface is designed for ease of use without extensive training requirements.
TradeGecko
TradeGecko is a newer cloud-based solution quickly gaining popularity for its affordable pricing and mobile capabilities.
Pricing
TradeGecko starts at $39/month for up to 10 users, with volume discounts available...
DEAR Inventory
DEAR is an open-source inventory management system with versions for both cloud hosting and local servers.
Pricing
The open-source download option is free, while cloud hosting starts at $39/month. Upgrades with premium features are available...
Key Takeaways
There are many robust inventory management solutions available for accountants, spanning a range of budgets and capabilities. When selecting a system, carefully evaluate your current and future needs, accounting software integrations, ease of use, and total cost of ownership. Systems like Fishbowl cater well to accounting professionals, offering strong accounting capabilities out-of-the-box. Others like TradeGecko provide more flexibility and mobility. Ensure you test solutions thoroughly before rolling them out to avoid disruptions. With an effectively managed inventory system, accountants can enhance transparency into assets and financial reporting for better-informed business decisions.
Strategic Insights and Efficiency Gains
Inventory management software can provide significant strategic insights and efficiency gains for accountants. By integrating real-time inventory data and analytics into accounting processes, accountants can enhance reporting accuracy, identify trends and opportunities, and advise clients on optimizing operations.
Specifically, features like barcode scanning, inventory valuation, and report automation help accountants efficiently track inventory quantities and values. This leads to fewer accounting errors and less time spent on manual data entry or discrepancy resolution. Detailed historical snapshots also facilitate more accurate financial statement preparation and analysis.
Additionally, embedded analytics and role-based dashboards give visibility into stock levels, sales velocities, turnover rates, and other KPIs. Accountants can leverage these data-driven insights to provide strategic counsel to clients on managing budgets, cash flow, and inventory planning. They can also inform decisions around purchasing patterns, loss prevention, and logistics management.
By removing inventory management friction through process automation and data centralization, the right software ensures accountants can focus less on gathering data, and more on delivering value-added advisory services to their clients. This strengthens client relationships while allowing businesses to optimize inventory strategies to support financial performance.
