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Welcome, this is Diane Gilson and today weíre talking about speed, accuracy and control
using your purchase orders. So, the one thing that I thought about where is it that you
would want speed, accuracy and control in the rest of your life, and that would be if
youíre out driving a race car. Now I havenít done a lot of that race car driving, but Iíll
tell you what, if I was in one I would want all of those things in place,Ö probably accuracy
and control first and then Iíd go for the speed. It seemed like a good analogy at the
time when I put this together.
So, okay weíll go on and today what weíre going to be talking about is why we donít,
and why we should, use purchase orders and how to get speed accuracy and control with
purchase orders within QuickBooks. Weíll be looking at purchase order reports, faster
cash flow using purchase orders, and purchase orders in real life. Weíre going to be talking
about some special techniques for special situations and what kinds of results should
we expect to see if weíre using purchase orders. So, weíll go ahead and get started
on that.
Weíre going to look at our hand-out for today, and again in the hand-out I have gone ahead
and included screenshots. I will flip back and forth into QuickBooks as we go along as
well, but in the hand outs youíll see the bigger screenshots and some reminders of how
to get to various places within QuickBooks.
So there are a lot of reasons why mid-sized and smaller companies donít use purchase
orders in QuickBooks. Of course anybody who is a larger company, and is handling a lot
of materials probably has transitioned over to the P.O. side. But, if you havenít, letís
just talk about why we see quite often that companies are NOT using the P.O.ís.:
First of all they might not know that itís available in QuickBooks or even have the feature
turned on. Itís not unusual for me to find out that people say, ìOh, well I didnít
know we could do purchase orders in QuickBooks.î So, in the event that you donít have that
feature turned on you can double check and see.
Ö.. You go up into ëedití. Weíre going into
that preferences screen, then weíre going to go to the company preferences and youíll
look at the items in inventory area, under the preferences and youíll want to click
on this box that says inventory and purchase orders are active. Now, if you donít deal
with inventory itís not going to hurt anything ñ but this is the way you get those purchase
orders turned on. Ö..
Advanced inventory is something Iíll mention again a bit later; youíre seeing it here
because Iím working with Enterprise and that is an option starting with Enterprise 2011
and so Iíve clicked that on because I wanted to play with it a bit. So you may see some
things that relate to advanced inventory as we progress. But, thatís where you turn on
your purchase orders feature and once youíve turned that on, youíll be able to see the
icon out here on your front screen, up here in this upper left hand corner.Okay, so in
some cases people just havenít used them before and they donít really know why they
should or how to use them so of course weíre going to cure that problem today.
Sometimes people say, well we donít buy much in the way of materials or we donít sub-contract
out a lot and we just have typical office supplies and a few fixed assets. And Iíd
say thatís one of the only really valid reasons that I can think of that you might not want
to use purchase orders. So, depending upon what type of business youíre running, then
that might apply. But, if youíre in construction or manufacturing or a service business where
youíve got sub-contractors and materials coming and going ñ and any kind of volume
through the business ñ that probably doesnít hold water.
Ö.. Maybe people donít want to take the time
to get quotes or bids and just say ìLetís just get this stuff and do it!î. And that
may be appropriate for smaller jobs but as soon as you start getting into any quantity
or volume I think youíll see that there are a lot of great reasons to be using P.O.ís.
Ö.. Or ìWe got the bid from the supplier, thatís
enough.î I got a quote from the supplier, well what weíll talk about is that, that
may be great for the supplier whoís given you the bid, but purchase orders could do
a lot to protect you as a purchaser, and weíll talk about that.
Ö.. Or ìToo much bother and paperworkÖî Weíre
going to be talking about how you can probably scale back on the amount of paper work thatís
involved and still have a good and effective purchase order system.
Ö.. Another thing that comes up is ìYou know,
I worked for a company that used P.O.ís. It was a big problem ñ you know that we had
to take care of every nickel and dime, and I donít want to impose that on my people.
It just takes too long. And keeps us from getting our job done.î I think that people
who are saying that might have come out of a system that was carried too far.