How to Merge Your Accounting With Your Inventory

As one of the only two certainties in this life, taxes should represent a priority for your business. In order to be able to meet your legal obligations and submit a comprehensive tax return on time, you’ll need to ensure your accounts are kept in immaculate condition throughout the calendar year. Thankfully, technology has changed the accounting world and made things easier for you and your company.

At the same time, bookkeeping should not be allowed to encroach on the day-to-day dealings of your business. For those working in the manufacturing industry, staying on top of your inventory is crucial to ensuring you have enough stock to meet orders and knowing when to order in more raw materials to replenish your supplies. A bill of materials is instrumental to this latter point.

But how can you marry the two concerns together? Is it possible to leverage technology to prevent your accounting and inventory efforts from existing in silos? Read on to find out more.

Embrace accounting solutions

For smaller businesses, it might be tempting to waive the expense of hiring an accountant and look after the books yourself. However, the importance of an accountant to companies of all sizes should not be underestimated, since they can save you a fortune in clerical errors and unexploited loopholes further down the line. Accounting is one area where you simply shouldn’t skimp, regardless of the size of your enterprise.

Of course, the 21^st century has brought an alternative solution to the traditional accountant. With the relentless onward march of technology, there are now a multitude of different types of accounting software, which can greatly simplify the process of invoicing, filling out balance sheets and, of course, filing those all-important tax returns come the end of the fiscal year.

When making a choice about which accounting app to use, it’s important you weigh the pros and cons of each individual piece of software and measure them against your needs. Xero, for example, is highly rated due to the extra features that the software offers.

Use third-party software to ease integration

Despite the plethora of additional features and benefits offered by Xero, it unfortunately does not allow for the creation of a bill of materials on the app itself. That’s a shame, since a bill of materials – essentially a recipe for the composition of every product in your inventory – is vital to staying on top of your stock and ensuring you always have enough raw materials at hand to manufacture products.

But don’t despair – despite this setback, it is still possible to achieve a bill of materials in Xero. All that’s required is the right workaround, namely by using a third-party app capable of creating a bill of materials and linking it to your Xero account. As one of the most popular technological solutions in the manufacturing industry, Katana is well-placed to meet exactly this need.

The secret of Katana’s popularity is not hard to fathom. As an app that was built by manufacturers for manufacturers, Katana anticipates all of your requirements and fulfils them. That means that you can generate countless bill of materials for all your products (and their variants), as well as adjust your inventory, calculate costs and check availability at the touch of a button. What could be simpler?