In TidyStock, the quantity and average cost of unmanaged items that you purchase to consume/sell in your business (called the “unit cost” in Tidy) can be overwritten. The unit cost and quantity of unmanaged items is not tracked over time, so you cannot see a history of sales, purchases, adjustments, or credits through the material item history screen or the Stock History Report.

So, items that you assign as unmanaged are generally things, that you use quickly and are of low value or importance to your business.

For example, it makes sense to assign consumables such as stationery supplies as unmanaged stock as these are low value in inventory terms (unless your business is selling stationery supplies). You may also assign direct costs such as freight as unmanaged items.

When items are managed in Tidy the only way to change the stock level is through a Sale, Purchase Order, Credit or Adjustment. This will lead to changes in the nominated inventory account, that is selected in Tidy in the Xero setup, on the Balance Sheet in Xero.

In Tidy, the “unit cost” is calculated using the average cost method. This method assigns a cost to items based on the total cost of all items purchased divided by the total number of items purchased. It also means that your managed items are recorded as a current asset in Xero and shown as such on your balance sheet.

When items are managed, Tidy is using a perpetual inventory management system to track managed items. This means that every time a managed item is bought, sold or used, those details are tracked in Tidy, allowing you to see changes such as the unit cost over time.

Generally high value inventory items, in terms of cost or value to your business operations, should be managed items. All assembly items (materials, ingredients, parts and components that you use to manufacture final products or to provide a service) are set to be managed items in TidyStock.

With managed items you are perpetually updating your stock level as items are bought and sold, so you have more certainty that your stock levels are true and accurate compared to unmanaged items. With unmanaged items stock levels and unit cost could be accurate if there is no overwriting of stock levels or the unit cost. With managed items you cannot overwrite stock levels without a reason, and you cannot change the unit cost. Therefore, there is much more assurance that your stock levels are true and accurate when items are managed.

By assigning managed items in TidyStock you can:

If your business handles items with expiry dates, you will need to enable batches in TidyStock. To do this, items must be managed.

Enabling batches and assigning items with an expiry date allows you to have greater control over them. You can see a material item history and produce reports showing movement of Batched items over time.

You will always know which items in your inventory are running out of date and can take measures to avoid waste. This is particularly important for manufacturing and healthcare businesses but can also apply in retail if your stock items have limited sell by dates.

Assign managed item status to inventory items with high value that you want to track perpetually over time.

Assign unmanaged item status to low value consumables or items which are direct costs that you track periodically.

You will always know which items in your inventory are running out of date and can take measures to avoid waste. This is particularly important for manufacturing and healthcare businesses but can also apply in retail if your stock items have limited sell by dates.