A Reorder Point is the threshold when you should order more products or stock to prevent shortages. This enables you to take control of the stock you have on hand and avoid over-ordering or having your cash tied up in old stock.
It is found in QuickBooks Online Plus version.
QuickBooks Online has aΒ Low StockΒ alert and anΒ Out of StockΒ alert once they are set up in your Inventory items.
These alerts are found in the Products and Services home page.
To use Low Stock alerts, in QuickBooks Online select how many of a particular product you always want to have in stock.
When the quantity on hand drops to or below the Low Stock alert, QuickBooks Online reminds you to order more.
Click on theΒ Gear Icon > Products and ServicesΒ then locate your inventory item from the list, under theΒ ActionΒ column clickΒ Edit.
In theΒ Low Stock alert fieldΒ enter the minimum quantity you want to have on hand. When the quantity on hand drops at or below the Low Stock alert, QuickBooks reminds you to order more.
If you are out of that item, QuickBooks Online will remind you that there is no available stock.
For example, our item Squawking Chook has aΒ Low stock valueΒ of 300 and ourΒ Quantity on handΒ is 292.
Clicking on the Low Stock Alert: the items that are low will populate, so you can see which you need to reorder, such as the example below. TheΒ QTY on HandΒ is 292 and ourΒ Low Stock AlertΒ amount is 300.
Clicking on the Out of Stock alert: the item that no longer has stock available will populate. A stock item will show in the Out of Stock alert when its quantity on hand is zero or below, as seen in our example of Dog Treats, we have a negative 4 amount.
Note: QuickBooks Online allows us to have a negative figure in stock if the invoice needs to be emailed out prior to receiving the stock for cashflow.
To order when low in stock or out of stock, go to the Low Stock or Out of Stock area.
This can be done in a number of ways.
Option 1:
After locating your item that requires a Purchase Order for restocking >Β ActionΒ column click onΒ drop down menuΒ > click onΒ Reorder.
This will take you to the Purchase Order window where other items can be added and quantity required ordered.
Option 2:
After clicking on theΒ Low StockΒ alert > choose all stock items to be ordered by selecting the box next to the item name (left-hand side) > this will populate a new buttonΒ Batch ActionsΒ (right-hand side), click on the dropdown menu and chooseΒ Reorder
This will take you to the Purchase Order window where you can add other items to be ordered.
When running the Stock Take Worksheet, the Low Stock Alert column can now be found on the worksheetΒ Reports > All Reports > Manage Products and Inventory > Stock Take Worksheet.
The Product/Service List Report will also give you the Low Stock Alert amountsΒ Reports > All Reports > Manage Products and Inventory > Product/Service List > CustomiseΒ > click on the side menuΒ Rows/ColumnsΒ >Β Change ColumnsΒ > scroll down and select the box fieldΒ Low Stock Alert.
A Reorder Point is not a set-it-and-forget-it task, because so many factors change customersβ purchasing behaviour. Sports stores will fluctuate between seasons. Grocers and retail stores will see increased sales around seasonal holidays as their customers entertain at home and purchase presents.
To understand and review your Reorder Point numbers and check your stock levels, read Business Victoriaβs βSet up a stock control process β. By setting up the correct processes and controls, youβll be able to run your business more effectively, as every dollar spent on unnecessary inventory is a dollar not spent on marketing or growing the business.
Find more information on inventory:
To read more articles related to product updates, visitΒ here.
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