For companies requiring advanced functionality, inventory processing has long been an “Achilles Heel” in QuickBooks. Some of the functions needed by many companies utilizing QuickBooks but not available in the application have included no automated option for FIFO or LIFO costing; no automated way to track inventory by serial number; and the inability to track inventory in multiple warehouses or locations. While QuickBooks 2011 does not resolve all of these issues, users can now track inventory across multiple warehouses by taking advantage of the Advanced Inventory add-on available in QuickBooks Enterprise Solutions 11.0.
Advanced Inventory Add-on Overview
The Advanced Inventory module is an add-on that integrates with Enterprise Solutions 11.0, and higher, and costs $699 per year. Upon activating the Advanced Inventory add-on, an Enterprise Solutions user can track inventory in multiple locations, transfer inventory from one location to another, establish non-traditional locations, such as, service trucks as warehouses, and identify, at the transactional level, the warehouse impacted by an inventory transaction.
Activating and Working with Advanced Inventory
To work with Advanced Inventory from within Enterprise Solutions, first, enable the Advanced Inventory preference; this preference is found by clicking Edit, Preferences, Items & Inventory, and Company Preferences, as shown in Figure 1.
Figure 1 - Enabling Advanced Inventory in QuickBooks Enterprise Solutions
After activating Advanced Inventory, proceed to Lists, Inventory Site List, and establish Inventory Sites for all locations that will track inventory. Inventory Sites can and should include traditional warehouses, along with non-traditional inventory locations, such as, customer consignments, mobile inventory stocks, and staging areas within a warehouse or production facility.
Upon establishing Inventory Sites, Enterprise Solutions can begin tracking inventory by location. This task is accomplished by associating an Inventory Site with each inventory-related transaction. For instance, the invoice shown below in Figure 2 makes use of the Inventory Site feature to relieve the Main Warehouse of the products sold.
Figure 2 - Using an Inventory Site in a Transaction
In addition to tracking inventory by site at the transactional level, users can transfer inventory between sites. To do so, choose Vendors, Inventory Activities, and Transfer Inventory to open the Transfer Inventory dialog box. In the Transfer Inventory dialog box, enter details such as, the transfer date, item code, quantity transferred, and the "from" and "to" locations.
Notably, Advanced Inventory does not compute a separate average cost for inventory by location; rather, it maintains a single average cost for each inventory item across all locations. Additionally, you cannot use Inventory Sites to track revenue, expenses, or overhead or similar items; instead, use the Class tracking feature for these purposes.
Summary
Though the Advanced Inventory add-on for QuickBooks Enterprise Solutions 11.0 does not add all of the functionality desired by some users, it does provide an inexpensive, effective, and easy-to-use approach to tracking inventory by location. Once the add-on is activated, users can set up Inventory Sites and begin tracking inventory by location almost immediately. Further, because Inventory Sites are flexible by nature, they can represent traditional warehouses, mobile warehouses, or even customer consignment locations, allowing QuickBooks-based companies to reclaim control of one of their most valuable and important assets. If your company runs QuickBooks and needs this type of functionality, then take a close look at this option today.
For a video demonstration of this tip, please visit www.tinyurl.com/k2tips89.