[9] – Procurement Process

Welcome to PSA Impact, your podcast for all things PSA, RMM, and MSP with your hosts, Rayanne Buccianico and Chris Tim. Learn how to get the most out of your PSA tool and manage your business by maximizing profitability and increasing efficiency within your MSP business. Let's listen in. Hi, everybody, and welcome to another episode of PSA Impact. With your hosts, Rayanne and Chris.

With me, I have my co-host, Rayanne Buccianico. Hi, Rayanne. How are you doing? Hey, Chris. I'm doing great.

How are you today? Good. Thank you. Very well. Thank you.

Rayanne, what topics would you like us to talk about today? I know there was a couple of things that we spoke about just before we started recording. What would you like to talk about today? I think today, what I would really like to talk about is the entire procurement process inside the PSA. Because I think there's a lot of confusion as to what the steps are.

When you're talking about the purchase order process, and the receiving, and the invoicing, I think that confuses a lot of people. Great topic. Of course, it's my absolute favorite. You got to stop talking about my favorite topics, Rayanne. I'll do my best.

It's always great to talk about one of your favorite topics. Absolutely. Let me just ask you a question because I know how I do it, and how I help other MSPs set up the procurement process. But what is your preferred method? Are you using the opportunities, and then you win the opportunities, and then, of course, it splits off, and goes over here to billing, and goes over there to purchase ordering?

Do you do the purchase ordering inside your PSA, or do you do it inside the quoting tool? What's your preferred process? Great question, Rayanne. Yes, I use pretty much the PSA tool, in this case, Autotask, to do everything. I create the opportunity in Autotask.

I manage the entire opportunity through Autotask. Do the quoting. Depends on what kind of quote it is. If it's going to be something like a bigger quote, or I just want to send the customer a nice, kind of pretty-looking quote, then I might jump into QuoteWorks to do that. But otherwise, most of the time, I'm just going to manage that quoting process through Autotask itself.

And then what I do is, as you say, then once I've got that opportunity to a point where I've won that order or won that opportunity, I then run the one opportunity wizard, and that pushes everything through into procurements. I then let everything flow through the entire procurement process. So things like creating the sales order, creating the purchase order, sending that stuff into billing, all of that kind of stuff, and then doing all of the receiving and the delivery and all of that kind of stuff, I manage all of that through the PSA tool. So I don't jump into any third-party tools or do any of that from the quoting tool side. So a quick question.

What are your thoughts about purchasing items for stock? Do you maintain your stock inventory inside the PSA, or do you not order stock items through a purchase order in the PSA? Great question again. So for me personally, I don't really do that myself, purely because I'm not an MSP, so I don't sell equipment to customers. However, when I work with MSPs, then I'll talk to them about that exact process, right?

So that's ordering stuff to keep in stock. And as you know, with the procurement, in order to ask, you can have different stock locations or inventory locations. So you could set up a location for different things. And actually, one of the things I was working on with a customer quite recently was about stock locations and having one of those stock locations in the boot of somebody's car, or sorry, I should say in the trunk of somebody's car. Let's make this so that you guys know what we're saying when we talk about a boot.

But yeah, they have that in the engineer's car. And then what they do is they use Autotask to replenish any of those items that the engineer would carry with them in their vehicle. So things like if they've got cables or switches or whatever the case might be, they can add that as a charge to a ticket. It pulls it out of that inventory location. And then they use that to manage, or use Autotask to manage that whole process and reorder that stuff back for stock and back into that location.

But then also using, to do that back-to-back ordering as well. So if you're ordering something directly for a customer that you're just gonna kind of order from your supplier, do the opportunity, do the quote, and just push that straight out to your customer. A lot of my clients work with that process as well through the procurements. That's interesting. We do the same thing.

We will have various locations, right? So you've got the headquarters or the stock room that is the closet. And then we have a location for each one of the tech's cars if they keep inventory in their truck, so that they can pull out a cable or they can pull out a router or whatever and install it at a client and then stick it on the ticket, like you said. And for the just-in-time inventory purchases, you're buying the server for this one particular customer. And as soon as it comes in, it's going right back out the door.

It's never going to sit on a shelf. We use a just-in-time inventory location so that we can track what's come in. And of course, we always have the received items. We also do one location, and we call it RMA, because if something is purchased and it turns out to be the wrong item, or it's a bad item, or for whatever reason it needs to go back, we move it out of stock and we put it into the RMA so that we can track it and wait until we get the credit memo from the vendor so that we can say, okay, this particular item is now closed out. So how do you handle the RMA?

Similar? Yeah, so exactly the same way. So, you know, have a location called RMA. And one of the nice things you can do, certainly in the Autotask PSA, is you can kind of swap inventory items. So you can actually say, you know, if I'm going to bring something out of stock that's currently sitting in stock and then go replace that at the customer, I can swap that out with a configuration item and put that configuration item back into stock.

So the way we would kind of say that is if you're going to supply a new switch or router or whatever the case might be, you know, you can provide that to the customer. What you can then do is swap that with the configuration item that you've got set up on their site and bring that old configuration item back into stock into that location called RMA, you know, until you figure out what to do with that, either get it repaired or sent it back to the customer or whatever the case might be. One of the things I really like about the way that the procurement flow or the procurement process works in Autotask is you have the ability to do this transfer to me. And I don't know if you've actually ever seen that, but, you know, from a ticket, if you've got an item that you're working on, so, you know, once the stuff has arrived into stock, you know, from the ticket, there's an option where you can say transfer this to me. And what that does is that automatically then makes, whoever has transferred it to themselves, makes that person an inventory location.

What the really nice thing about that is, is then when you come to send out that item on the picking slip, it'll actually say, you know, this item is currently sitting with this engineer or whatever the case might be. So you might need to go and grab that item from wherever it's come in. You need to work on it, configure it, do whatever you need to do. And you simply say, make me the inventory or the inventory location for that. And it will simply go ahead and transfer it into you.

And you can then run a stock report at any time and see who has what kits. And I really, really like that side of how Autotask does it. Right, so we do the very similar thing. And at the end of the month, we have an automated report come out from Live Reports that shows us all of the items in each location so that we can adjust the accounting system to make sure that everything that's in inventory is sitting in the accounting system inventory as well. And that anything that's no longer in inventory has been invoiced to a customer.

That's a completely different conversation. But that's on the other end of it. And because once the opportunity is won, then it kind of splits, like I've said. And half, it goes over here, it's ready to be invoiced to the customer. And then it also goes over to the purchasing side where it's ready to be purchased from the vendor.

And then they never meet up again, except for at the configuration level. The configuration item level, I should say. And many people, I think, confuse the configuration item with the inventory item. So what are your thoughts on that? Yeah, exactly.

I mean, they are two completely different things, right? I mean, the inventory that we're talking about here or stock control, that is typically something that you're gonna buy, keep in a storeroom or a closet or a location somewhere that you might buy a bunch of them and then eventually sell those on to the customer. And then the configuration item, if you think about that as an installed asset, so that's something you've already installed at the customer site. And then with that configuration item, which you can actually change to use the words installed assets or something like that with your- And that's exactly what we do. Because if they start to get confused about the configuration item, I'll just say, hey, how about if we just change the name?

And let's call it an installed asset. It kind of builds that wall between, this is inventory item, inventory is for sale. The installed item is already installed at a customer's location. So, sorry, I did not mean to interrupt. That's okay.

And I mean, yeah, I like the word installed asset because it does exactly what it says on the tin, right? It's an asset that's been installed at the customer side. It belongs to them. And then you're gonna track things like warranties and all of those kinds of things on there. So, but a question for you, Rayanne, in terms of purchase orders, you asked me earlier on about how we do our purchase order.

So how do you do it? Do you do it through the PSA as well? Or do you kind of do it more from QuickBooks or from QuoteWorks? How do you manage that process? More times than not, the quote goes out to the customer through QuoteWorks.

And when the quote is approved by the customer, then it's pushed into Autotask at the opportunity. Then we win the opportunity. And even though the actual purchasing may happen inside QuoteWorks, because if you're using Edelize, you can just say, hey, let's go ahead and order this and order that and order this. Otherwise, sometimes it'll just give you a link. You know, here's the link so that you can order it from Amazon or something to that effect.

But even though the actual ordering from the vendor may happen through QuoteWorks, I will still have them recreate that purchase order inside Autotask because that's where the receiving is gonna happen. It needs to be in Autotask in order to be able to receive it and to install it at the customer level. So if they really prefer to use QuoteWorks to send the purchase order to the vendor, great, do it. But I still wanna see it in Autotask because it has to finish the cycle. And it can't do that in Autotask or in QuoteWorks.

Sorry. Yeah, so exactly. And I mean, once you run that one opportunity, was it a wow, as I like to call it, then it does all of that for you in the back end anyway. So it kind of creates a sales order and then pushes that stuff into procurement so that you can then go ahead and generate the PO and all that kind of thing. So just to ask then, how do you get that into QuickBooks?

Do you push that in from Autotask then? Do you push in the invoice and the PO from Autotask into QuickBooks? Or do you push the PO in from your QuoteWorks system? All invoices to customers get into QuickBooks from Autotask. The purchase order itself, it really depends.

First of all, if you are using QuickBooks Desktop, then I recommend using the QuoteWorks push into QuickBooks because the purchase order push from Autotask into QuickBooks Desktop has been broken since day one. So it doesn't really work as intended. And it generally causes more problems than it's worth. However, if you're using QuickBooks Online or Xero where the integration is a lot more streamlined, then we go ahead and we'll push the purchase orders into QuickBooks from Autotask. Okay, that's great.

Yeah, I mean, I don't know if too many people, certainly in the UK that are still using the desktop version of QuickBooks. So I don't have that problem, I guess, as much as you guys do. In fact, I don't know if too many UK customers using QuickBooks either. I've got one or two who are, but on the whole, most people over here are using Xero. So I think that's kind of more a problem over in your side with that kind of stuff, not syncing properly into the desktop version.

Xero is gaining some traction here in the United States. However, as an accountant, I really struggle with it. It's just not as streamlined or as easy to use, I think, as QuickBooks Online. But I know that it's very popular in the international market. And I believe that the integration from Autotask to Xero is really nice and smooth, and there's very few problems with it.

So I've heard a lot of really good things. Yeah, absolutely. And I mean, this isn't a discussion about the invoicing tools. But actually, funny enough, I think, obviously, because Autotask is an American product, the integration out of the box into QuickBooks Online is obviously a lot better than it is with Xero because there isn't integration out of the box. And I say that with air quotes, which you can see me because we're on the screen, but obviously, they can't see that on the podcast.

I know it's not a part of Autotask, it's still a third-party integration, but it's kind of out of the box. That's something that Autotask can turn on. And you don't have that with Xero. So I think there is still something good going with the QuickBooks integration on that part of things. So shout out to our listeners out there.

What is your procurement process and how do you go about it? And if you do something different than the way that we're doing it, we'd love to hear from you. So check us out at psaimpact.net. We also have a Facebook and LinkedIn group, and you can also find us on Twitter. Absolutely, and to follow on from that, I mean, if there's any specific topics that people wanna talk about, Rayanne and myself hang around in the Autotask Facebook group quite a lot, and we see a lot of questions in there.

But if there's anything specific, if you go to our website over at psaimpact.net, there is a facility there where you can leave a recording. We do listen to that regularly. I listen to that pretty much every day. There hasn't been anything on there for a while. So if anyone does wanna go ahead and give us some ideas and suggestions on what you want us to talk about, then by all means, please do that.

Please visit one of the socials, and we'll be happy to talk about that in the future. So Rayanne, thank you very much for your time today. All that's left for me to say is your PSA is the key to your MSP success. Go out and make an impact on your world today. Thank you for joining us today on PSA Impact.

We hope you've learned something and that you'll join us next time when we answer new questions posed by our listeners.