Has anyone found a way to track raw materials use or to track
consignment accounts with Quickbooks or any other software?
Just an idea. I use Quickbooks a lot (I am also–in addition to being
a jeweler–a small biz consultant helping startups, mostly). I do not
use it for consignment accounts myself, but here’s a suggestion:
Enter as separate “Inventory Items” all the finished pieces you sell.
When you consign any of them to a shop, cut an Invoice to the shop
(you can set up a customized one called “Consignment Invoice” or
something).
As pieces are sold & you are paid, you can Receive Payment against
that invoice, and in the “memo” area indicate which piece the payment
is for. This keeps track of the dollar value of the items on
consignment to that shop.
An “Inventory Item” in QB can be a particular finished piece ; it can
be sold in multiples, or singly (as in the case of one-of-a-kind)–in
both cases you can assign the price that goes with the item when you
enter it into inventory.
That is the short way to do it, but doesn’t handle the Cost of Goods
Sold issue for U.S. businesses.
“Items” as used by Quickbooks is sometimes hard for new users to
understand, but it is a very useful tool–you can add an Inventory
Item each time you complete a piece, either adding an Item, or adding
to the count of similar items with the same price.
In addition to having an Inventory Item that is a finished piece–in
which case you can show all the parts that went into it–you can have
other inventory items that are “parts.” This allows you to use the
“parts” inventory items when you are purchasing raw materials,
findings, stones, etc., and you can ue the “finished goods” item when
you are invoicing. This works best if you use the Purchase Order
function in Quickbooks–this allows you to track what is ordered and
check off items received, which puts them into inventory. You thus
put materials into inventory when you receive parts from your
suppliers.
When you complete the piece you enter it into inventory (and there is
a provision for entering all the inventory parts used in its creation
within the inventory item); when you put the finished piece on an
Invoice, it takes the parts used in its creation out of inventory and
puts their value into Cost of Goods Sold. If all the items on the
invoice are not actually paid for, but some are returned, you can cut
a Credit against the customer (shop), which puts the stuff back into
inventory.
This is, I am sure, also possible in the other accounting programs
that have an Inventory function. For ones that do not (or if you
don’t want to do all this), you can just use the short way
above–Invoice for when you deliver work to a shop on consignment, and
receive payments against the invoice when they are sold & you are
paid. Then you’ll have to deal with the inventory part in some other
way.
The learning curve is kind o steep in the beginning, and it takes time
out of your busy day to set it up and figure it out and make it where
the Items List doesn’t seem a mess (I suggest using numbers to
identify ea. piece or part). Once you understand it, though, it can
save you some time (so long as you keep up with entries and stay
consistent and disciplined about it–where people usually run into
trouble is in keeping it up on a daily basis–this is key, in my
opinion).
I hope this makes some sense and is helpful to someone,
Colene Abramson
Wayland, MA
Cynthia