Stock management is a vital aspect of any company as it gives you the ability to understand your business better. From effectively controlling stock levels to improving customer service and warehouse efficiency, stock management is crucial for the success of any business.
A business with strong inventory management is more informed about its product lines and it makes them more dynamic and less reactive when it comes to things like order management and supply chain. You can even implement stock management solutions like Sage 200 to learn more about your customers purchasing habits.
In this article, we’re going to take a look at Sage 200 and how it can be used to help you better understand your business.
Manage your stock in Sage 200
Sage 200 is a powerful Enterprise Resource Planning (ERP) system with impressive stock management features that let you effectively manage stock units and monitor your stock levels. You can track what items you have in stock, know where they are at any time, where they have been on their journey, how many have been sold and purchased, and most importantly their profitability.
In Sage 200, you can enjoy a fully integrated stock control system to help with invoicing, sales orders, purchase orders and serial and batch number traceability, saving you time and money in the process. This information is automatically updated, so stock levels and values change in real-time, keeping your data relevant and useful.
You can improve your invoicing system with Sage 200, thanks to automated stock level management. Stock levels are lowered when a product is sold, with the record including where the item is going to and where it’s being dispatched from.
If you run out of an item when a sales order comes through, then that stock level reaches a negative figure (unless you use an average costing method for that item). As you can’t send out products you don’t have, Sage 200 won’t post an invoice until the stock levels are updated.
Any items that you sell go through the Sage 200 system, allowing you to update the items that you sell via sales orders for your customers. Any available stock is automatically allocated to these sales orders, with the free stock amounts being reduced without updating stock levels.
This intelligent feature automatically reserves stock items for the sales order, ensuring that fulfillment occurs in a fluid way. If there isn’t enough stock when the sales order is placed, then any remaining stock can be manually allocated when a new purchase order is booked in.
Purchase orders in Sage 200 work in an easy-to-understand way. First, enter the purchase order by inputting the items you want to purchase from your supplier. When the purchase order is receipted into your warehouse, the system automatically updates stock levels at the in the software. If this item uses average costing or FIFO, then the prices of items are also updated.
Invoices for purchase orders are then automatically recorded and posted out. This in turn increases the value of the stock bought, updating the stock nominal account. If the invoice price is different in any way from the price on the order, any difference is posted to the PO Differences nominal account.
When using Sage 200, you have three different options for stock types. These include:
- Stock: used for physical items that you want to count and quantify.
- Service and labour: this is for any non-physical items that you can’t count. This includes things like time, man-hours or services.
- Miscellaneous: this is for any stock that you don’t want to quantify, such as components or spare parts like screws or nuts.
You can also use product groups in Sage 200, which groups together related stock items in a useful group. Some of the settings can be adjusted across this group, updating all of the stock items found there at once. To do this, it’s important that all of the stock items are of the same type and use the same costing method, such as FIFO.
Product costing allows Sage 200 to calculate the cost of stock items, which helps you value your existing stock, determine the value of transactions via asset nominal accounts and calculate the total profits on any sales orders.
There are a few different methods available with Sage 200 to do this, including:
- FIFO (First in, first-out): This method uses the oldest cost associated with the stock item until all of the stock bought at that cost is sold through. Then the system will update to the latest cost price associated with that item.
- Standard: This uses the cost price stated on the stock record. The cost price will only change when it is manually changed in the software.
- Average: This sets an average cost price for stock items based on an average of the various cost prices associated with the current stock holding on that item. It’s calculated by dividing the total cost paid for all stock items divided by the number of items currently in stock.
Warehouses & Locations
Sage 200 allows you to record the physical location of stock items found across different warehouses or bins. A warehouse is seen as a single location, with a bin being categorised as a shelf or aisle in a warehouse.
This allows you to accurately pinpoint specific locations and stock items across large or multiple warehouses. You can set up records for stock levels, create stock take sheets and even print picking lists for sale orders and base them on different locations.
Considerations when Setting Up Stock in Sage 200
Before diving into Sage 200 and setting up your products, ask yourself the following questions:
- Do you want to store information about non-stock items like services and labour? If you do, you’ll have to create product groups for them.
- What is your preferred costing method?
- How do you want to group up stock items?
- Do you want to keep track of stock levels in multiple locations? If so, look into warehousing.
- Do you want to include international shipping fees for items on purchase orders? If so, turn on landed costs.
- Do you intend to record stocked units for items (such as boxes, cartons, etc.)? If so, set up units of measure.
- Are you using purchase order processing to handle stock purchases? If you don’t use POP then you can issue stock with the stock options settings.
- Do you order goods from suppliers to fulfill sales orders?
It’s clear that Sage 200 has everything under control when it comes to inventory management. Stock is cash, so it’s essential businesses have an accurate, real-time view of all their stock. Afterall, you wouldn’t want your cash to go missing!
It’s also incredibly important to have streamlined and automated stock processes in place in order to maximize sales through sales order fulfillment. Not only does this grow your business, it keeps your customers happy. Meeting current and future demand is essential for all businesses who deal with inventory management.
Why choose Eventura to deliver your Sage 200 project?
With two decades of Sage deployments under our belt, we are experts in delivering robust Sage 200 solutions that are meticulously designed to suit your specific business needs. We take a full 360-degree view of your business, and help you identify all of your requirements.
Our team of expert business analysts, developers, consultants, technicians and support staff will guide you through your Sage 200 project from conception, through to deployment and ongoing support.
If you would like to speak with one of our Sage 200 experts, you can request a free call back here.