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What’s new with Inventory in Xero

Posted 8 years ago in Product by
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It’s been three months since we launched Tracked Inventory in Xero. It’s proven to be a great tool for small businesses who want a real-time view of the products they sell.

Our customers are impressed with Inventory in Xero. They’ve found it to be an easy way to keep track of their stock.


Why use inventory?

When we launched Inventory  back in March, we showed our customers how they could use it to help their businesses thrive.

Managing inventory can be a challenge for any business. Our customers appreciate having visibility over what products are selling well, and which aren’t.

Customers using Tracked Inventory say they are making better decisions about their stock levels. They’re ordering stock at the right time, and they always know which products are selling well.

Unsold stock means money is sitting on your shelves gathering dust. You also have to keep track of which products sell out so you can reorder in time.

Our customers are also keeping their accountants happy. Xero automatically calculates their cost of goods sold. This means they can easily work with their accountant to make product decisions that improve their profit.

Untracked Inventory is still available for businesses that only provide services or buy items when a customer orders them. Interestingly, we’ve seen an increase in our customers using this method too.

A new inventory report

If you’ve been using Inventory for the last few months, now might be the time for an inventory count (stocktake). Today’s release includes a simple inventory list report that will help you with this.


Our new Inventory Item List report provides a snapshot of the products you currently have in stock. You can quickly view the total value of your stock and assess what products you have available. This makes it easy to tell which products you need to order.

You can also use the new report as the basis for an inventory count (stocktake). You can compare the report to what you have in your warehouse or on your shelves. If you have any discrepancies or damaged stock you can enter these using inventory adjustments.


A regular inventory count is a great practice to make sure you keep on top of your stock. It confirms the quantities you think you have versus what you actually have.

Accountants can use the new report for reconciliations

Xero makes it pretty hard for inventory accounts to go out of balance. In fact, once you’re up and running, it just won’t happen. However, when converting a client from another system, there are times when opening balances can get out of whack. The Inventory Item List report is perfect to track down any anomalies.

What’s coming up in Inventory?

We’re working on a comprehensive inventory report. We’ll calculate profit margins on each of your products. You’ll also be able to see all transactions for each product. Advisors can use the report for thorough financial reconciliations.

We’re also going to introduce the ability for you to hide inventory items you no longer use. This will be handy for when your product list evolves over time.

Let us know in the comments how you’re getting on with Inventory. We’re keen to hear your feedback. And for more information on this release, as always you can refer to our Release Notes.


James Moore
July 10, 2015 at 3.08 am

Inventory is currently driving me nuts. I accidentally marked an item as an inventory item, and it’s my most popularly sold item. Now, even though it’s not something we track inventory on, I’m told I can’t sell the item due to it being out of stock. Even if it’s something sold that would just go on our back order list or whatever.

REALLY need a way to remove an item from the inventory management if it’s accidentally marked that way.



Ros Black
July 16, 2015 at 12.50 pm

Thankyou for your feedback. I’m sorry to hear you’re having problems with our inventory product. Tracked Inventory is designed for businesses that typically keep their inventory in stock rather than on backorder. It sounds like Untracked Inventory might be a better solution for you.

Untracked Inventory won’t keep a record of your quantity on hand but you can still run reports on your items to see how well they’re selling.

Here’s some guidance on the 2 options for managing Inventory. It will help you decide if Untracked Inventory will meet your needs or if one of Xero’s add-on partners would be better for you. Here’s also some Help on how to set up untracked inventory items. (Unfortunately you won’t be able to simply change your tracked items to untracked.)

Help for inventory options – https://help.xero.com/InventoryOptions
Help for setting up inventory items – https://help.xero.com/Inventory_ItemAdd
Inventory add-on partners – https://www.xero.com/add-ons/category/inventory/

July 16, 2015 at 4.46 pm

I’m looking forward to the “comprehensive inventory report”.
I need a sales report that will show the details of BOTH tracked and untracked item sales.
At the moment the “Sales by Item” report only lists the untracked inventory items, which isn’t terribly useful when using tracked items.

Ros Black
July 17, 2015 at 2.25 pm

Yes the report we have in our pipeline will include both tracked and untracked items. Have you seen our Inventory Item Details report? This gives you transaction details for both tracked and untracked items. It might meet some of your needs in the meantime. Here’s some Help on how to get the most out of this report.

Help for Inventory Item Details report – https://help.xero.com/ReportInventoryItemDetails

Amanda Roy
July 20, 2015 at 11.18 pm

Hi Xero team,
Inventory is very difficult for us without pictures. We’d love to have a picture of our product available.
Thanks, Amanda

June 29, 2018 at 1.15 pm

I think there is a bug in the system that alters invoices so that remove the part number details from an invoice and just leaves the description and price. What this means is that stock isn’t adjusted by the invoice and it puts the stock levels out. Is there a way to fix an invoice that has had this happen to it. Also there is no history of the item recorded as sold to that customer for reporting purposes, so doing a stock adjustment doesn’t totally solve this issue. Doesn’t always happen but it is very frustrating when it does.

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