Inventory control

Video transcriptionHi I’m Federico and with the help of Alex’s mac os voice, I’m going to make you a quick demo of how to control your inventory with the help of myAbacus.

We are in the demo company we’ve been using for this video series.

Let’s quickly review where we left in regards to products after the last videos.

We go to “expense”, click “edit” to review the transaction details. And we can see we bought 30 units of dynamite and 15 of canary grass for a total of 45.

Now we go to “income”, click “edit” to do the same. And see we sold 10 units of dynamite and 5 of canary grass for a total of 15.

As you may remember, the accounts for this products were created simultaneously with the first transaction and in the same page.

Let’s go back to “products & services” to review these accounts in more detail.

We click “edit” next to dynamite…and see how the account type is a product I buy & sell. This combination indicates to myAbacus that the inventory of dynamite must be controlled. This would not be necessary, for example, for a service type account.

The canary grass account is of the same type, so let’s see what myAbacus is doing to control the inventory of both products. We go to “inventory”.

For now let’s focus on the first column “quantity system”. According to myAbacus, we should have 30 units in inventory. Clearly, 30 is the result of subtracting from the 45 units I bought, the 15 I sold. And also the sum of 10 units of canary grass and 20 of dynamite.

The 10 units of canary grass are in turn the result of subtracting from the 15 units I bought, the 5 I sold. And the 20 of dynamite, the result of subtracting from the 30 I bought, the 10 I sold.

So far it’s all clear in terms of units. But it’s also important to know how much are those units worth. In other words, what is the value of my inventory. We go to the “inventory report”.

Here we can see the same quantities – 30, 10 and 20 – but with their corresponding values. Let’s click “show everything” to see the detail.

The 10 units of canary grass I have, multiplied by their price of 30, equals 300. And the 20 units of dynamite I have, multiplied by their price of 60, equals 1200. The total ads 1500.

Now that we know how does myAbacus control the inventory, let’s take a quick look at what other tools do we have at our disposal. We go back to “inventory”.

And suppose I did a physical count of dynamite to discover I have only 18 units. I enter that value in the quantity real column and the adjust column shows that to synchronize the quantity in the system with the real one, I must make a -2 adjustment. In other words, write off or remove 2 units. Let’s say, the reason was internal consumption, so we enter that as a comment.

Now suppose, in the opposite example, I have 15 units of canary grass in reality. We enter this value in the quantity real column and the adjust column shows -in this case- that to synchronize, I must do a 5 adjustment. In other words, add 5 units.

What this adjustment propose is to simulate a purchase of 5 units at a suggested price of 30, which is the average cost of canary grass in the system. But let’s say, those 5 units were our starting inventory of free samples, given to us by our supplier. So we enter “starting inventory samples” in comments and “0” in amount.

We can now click “adjust”. See how the numbers on the quantity system column – 15 and 18 – are now in line with reality. We can also click the “adjustments tab”, where we can see, edit, or delete the adjustments.

The reasoning behind stock control is similar to cash. If you maintain quantities in the system synchronized with reality, you will avoid unnecessary losses and make sure the information in myAbacus is complete & reliable.

This does not mean you should spend part of your valuable & limited time trying to get to the bottom of minimal or occasional discrepancies. Instead, you can take advantage of the adjust functionality to keep the system in sync with reality. But without forgetting that those adjustments must be justified or within a margin of error acceptable for your business.

I hope this was helpful & clear. And thank you very much for your attention & interest in myAbacus.