Inventory management can present challenges for small businesses in the UK. Xero and QuickBooks offer features that address these challenges. This article summarises how these platforms, along with their connected apps, manage common inventory tasks.
Xero and QuickBooks Inventory Management Basics
Xero tracks up to 4,000 finished items, providing details such as sales trends, quantities, value, and profit. QuickBooks Online apps offer comparable tracking capabilities to maintain adequate stock and reduce the risk of shortages.
Both platforms integrate with e-commerce websites. United Kingdom’s retail e-commerce revenue is projected to reach approximately $188.8 billion by 2029, which highlights the importance of real-time accuracy across multiple sales channels.
Xero and QuickBooks also support quick invoice and purchase order generation by adding frequently sold items. In addition, both connect directly to HMRC to facilitate tax filing and comply with Making Tax Digital (MTD) regulations.
Main Points
- Xero and QuickBooks include practical inventory management features
- Xero supports tracking of 4,000 items
- Users can review sales trends, quantities, and profits
- Real-time e-commerce integrations keep stock levels current
- Invoice and purchase order creation can be streamlined
- Direct HMRC links support MTD compliance
- Additional apps expand functionality
Built-in Inventory Features
Xero and QuickBooks have basic inventory functions that can meet many small business needs. Certain limitations may apply when more complex requirements arise.
Simple Stock Tracking
Xero can manage up to 4,000 finished items, showing how much stock is available and its total value. QuickBooks offers unlimited item tracking.
| Feature | Xero | QuickBooks |
| Item Tracking | Up to 4,000 items | Unlimited items |
| Stock Valuation | Shows total value | Shows total value |
| Cost Tracking | Yes | Yes |
When More Apps Are Needed
Basic inventory tools work well for small operations, but additional apps may be required for features like multi-warehouse oversight or advanced pricing structures. Real-time syncing, in-depth reporting, or industry-specific solutions can also be attained by integrating third-party options.
“The right inventory tool should adapt to business growth while remaining straightforward to use.”
Xero Inventory Integration Benefits
Xero’s inventory feature set is enhanced by apps available through the Xero App Store, which offers various tools for greater efficiency. E-commerce and inventory solutions commonly have user ratings around 4.78 out of 5 stars, with some reaching 4.91 out of 5.
Reasons to Integrate
- Reduced manual data entry, potentially lowering errors
- Real-time stock updates, improving inventory visibility
- Simplified reconciliation, aiding in identifying and resolving discrepancies
- Enhanced reporting and insights, enabling data-based decisions
Businesses in specialised sectors can also explore niche apps, such as those tailored to fresh food distribution or e-commerce shipping. Through these integrations, Xero can serve as a more comprehensive inventory system.
Connected Apps for Improved Inventory Management
Several Xero-connected apps address a range of inventory needs:
Vend: Retail Point of Sale
Keeps stock details accurate across multiple stores and updates Xero accordingly.
DEAR Inventory: End-to-End Management
Suitable for complex supply chains. Provides multi-warehouse management and detailed reporting.
Unleashed: Cloud-Based Inventory
Offers tracking and costing features. Integrates with Xero to reflect real-time data.
simPRO: Trade Sector Tools
Combines job and inventory management, targeting trade businesses.
| App | Feature | Best For | Rating |
| Vend | Multi-location sync | Retail stores | 4.86/5 |
| DEAR Inventory | Multi-warehouse support | Complex supply chains | 4.91/5 |
| Unleashed | Advanced tracking/cost | Detailed valuations | 4.78/5 |
| simPRO | Job + inventory combo | Trade businesses | 5/5 |
Real-Time Stock Tracking and Reporting
Both Xero and QuickBooks support real-time stock tracking, helping prevent inventory shortfalls or excess. This approach can also reduce administrative errors.
Advantages of Real-Time Updates
- Immediate visibility into stock quantities
- Automated sales and purchase orders
- Assessment of profitability
- Multi-currency handling for global sales
- Integration with common e-commerce platforms
Comparing Xero and QuickBooks
| Feature | Xero | QuickBooks |
| Real-time stock tracking | Yes | Yes |
| Multi-currency support | 160+ currencies | 100+ currencies |
| Third-party integrations | 800+ | 650+ |
| Mobile app availability | Yes | Yes |
Real-time data can allow for more efficient management and fewer repetitive tasks.
Multi-Channel Sales and Stock Synchronization
Xero and QuickBooks offer multi-channel integration, keeping stock information synced across multiple sales avenues.
E-Commerce Integration
For businesses using Amazon, Shopify, eBay, or proprietary websites, Xero Inventory Plus consolidates stock information, limiting the potential for overselling.
Warehouse Management
Organisations that operate across multiple warehouses may require advanced visibility. QuickBooks provides inventory solutions that track items and coordinate fulfillment for businesses operating at scale.
Managing Profit Through Effective Inventory
Optimising inventory can increase profit margins and reduce unnecessary costs. Both Xero and QuickBooks facilitate pricing strategies, margin analysis, and cost control.
Stock Valuation Methods
Many inventory apps support valuation approaches such as FIFO, LIFO, and weighted average, ensuring accurate financial records.
“Automating inventory tasks can reduce manual processes and decrease the likelihood of mistakes.”
Conclusion
Xero and QuickBooks, along with their compatible apps, offer a structured method for managing inventory at varying scales. The ability to track 4,000 items in Xero or to utilise additional tools through QuickBooks helps businesses maintain consistent stock control, higher accuracy, and balanced inventory levels.
Adopting these systems may lead to more informed decision-making, less manual workload, and improved financial outcomes. Digital inventory management continues to grow in relevance, and these platforms can be incorporated by businesses seeking greater efficiency.
At Together Accounting, we are partners with both Xero and QuickBooks. Our team is available to help troubleshoot specific issues, configure the software to suit your needs, and manage ongoing inventory requirements.
*This post is an updated article previously published on 7th November 2018:
