If you’ve just started using QuickBooks, one of the early steps to set up your accounting for success is adding the goods you sell to customers. Setting up products and services in QuickBooks Online is a fast and easy process. There are a few different methods you can choose from, which we will walk through below.
Note that every time you create a new product or service, you’re adding an item to a list. This is how QuickBooks organizes your transactions and accounts.
Whether you are adding a product or service, the workflow for creating each is essentially the same. You will choose from four types:
Non-inventory
Service
Bundle
Inventory
You only need to select “Inventory” if you plan to track inventory in QuickBooks. Otherwise, you can create lists using non-inventory and service items. Bundles allow you to sell multiple items as a single product or service.
Inventory tracking and bundles are only available with the QuickBooks Online Plus subscription. Neither is required for a basic set-up. For many small businesses, non-inventory and service items are all they need. If you do not start off tracking inventory but decide to enable that feature down the road, you will have to reclassify qualified non-inventory items.
Now, let’s break down three simple ways to set up products and services in your QuickBooks Online account.
3 Methods to Set Up Products & Services in QuickBooks Online
You can easily add your products and services by either importing a spreadsheet or adding them manually in one of two ways.
Import a Spreadsheet
This is the fastest way to import all of your products or services into QuickBooks at once.
Go to Sales on the left navigation > Select Products and Services sub-tab > Click Import.
Download the sample Excel spreadsheet and review it.
On your spreadsheet, organize all column titles and the order of your columns to match the sample file. Once complete, go back to the Import page, click Browse, and upload your file.
Map each QuickBooks field on the screen to one of your Excel columns. The selected column’s contents will be imported into the selected QuickBooks field.
Review your data to ensure everything is mapped correctly and make any necessary adjustments. Click Import when done.
Build-All-at-Once
With this method, you’ll create items from scratch by entering individual products and services.
Go to Sales on the left navigation > Select Products and Services sub-tab > Click New.
Select the type of product or service (Inventory, Non-Inventory, Service, or Bundle).
Enter the product or service details, including the Name, SKU, Category, Sales Information, Sales price/rate (leave blank for variable rates), and Income account.
Click Save and Close.
Build-as-You-Work
You can also add new products and services to QuickBooks Online directly from sales forms. From a new sales form, select Add New, which takes you to the same module as the build-all-at-once method.
Pro Tips
Follow these tips to maintain organized product and service lists and ensure your client-facing sales forms are professional and easy to understand.
If you create new items directly from sales forms, enter all necessary information into QuickBooks before adding them to invoices.
Note that some information is customer-facing, like Sales Information. Write detailed yet concise product and service descriptions.
Do you charge a variable rate for services? No worries, you can simply leave the Sales price/rate field blank and add the agreed-upon amount when you create the invoice.
Be sure to select the correct Income Account, which is how QuickBooks will categorize income once a sale is complete.
Plan and organize your income accounts and sub-accounts ahead of time to make analyzing and pulling specific data from financial reports much more manageable.
And that’s all there is to it! QuickBooks makes the entire process easy no matter which method you choose, whether you’re setting up all of your products and services to your new account or simply need to add a few new items.
If you have any questions or would prefer to have an experienced accountant set up your entire business in QuickBooks and continue managing your books, schedule a complimentary consultation or call 603-505-2368 today to learn more!