02.13.24 Inventory Management - Deep Dive into Katana

For those of you that "Love" inventory, Michelle and Dan will be joined by Shawn Coultice from Katana to take a deeper look into their Inventory Management Solution. It just might be something that you'll want to "Be Mine" Happy Valentine's Day!!!

QB Power Hour is a free, biweekly webinar series for accountants, ProAdvisors, CPAs, bookkeepers and QuickBooks consultants presented by Michelle Long, CPA and Dan DeLong who are very passionate about the industry, QuickBooks and apps that integrate with QuickBooks.

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Transcript

Michelle Long: 0:30

Welcome, everybody. And thanks for joining us for another QB Power Hour. Today's topic is the inventory management. We're doing a deep dive into Katana and we'll actually be talking about the different types of clients and situations where it's a really a perfect fit for Katana. So we're very glad to have you all joining us today. And yes, thank you, Merv. How about those Chiefs? Yes, I am. Proudly wearing my Kansas City Chiefs. My name is Michelle Long, CPA with an MBA in Entrepreneurship and the owner of Long for Success, member of the Intuit Trainer Writer Network for a very long time, the author of several different books, check them out on Amazon, and very glad to have you joining us today. Dan, go ahead.

Shawn Coultice: 1:09

Alright,

Dan DeLong: 1:09

my name is Dan DeLong, owner at Danwith, worked at Intuit for nearly 18 years, co hosting today, also over at SchoolofBookkeeping. com. We do the workshop Wednesdays, oddly enough, on Wednesdays. Doing some tech editing for the QBO for Dummies series of books, which should be available now on Amazon. And Shawn has joined us before, but bears some re introduction.

Shawn Coultice: 1:34

Hello there. Thanks a lot for having me back. It's always great to be alongside Michelle and Dan and being a part of some of their jokes throughout the session and maybe a Star Wars reference or two. So yes, I'm Shawn Coultice. I'm the head of channel partnerships at Katana. I've been in the manufacturing and inventory space for about the last 15 years started actually at a manufacturer. implemented their solution and then worked with a lot of accountants and bookkeepers throughout the years implementing and helping them select the appropriate inventory solution for their business. And I've been at Katana now for three years helping to build out our relationships with accountants and bookkeepers and providing a service through Katana to help their clients better manage their inventory.

Dan DeLong: 2:20

Thanks again for joining us. We really appreciate you coming on and we had and we'll talk a little bit about what we have done in the past regarding inventory and some of the things that we've talked about with Katana. So today is really focused on What's right for katana, you know as far as those inventory workflows, so I want to take a little deeper look into the product itself but a little bit about the details about the qb power hour there every other tuesday at noon eastern not eligible for cpe Sadly, but you can always check the website for upcoming topics If you have any topics you can always go to quickbooks qb power hour. com and put in a suggestion things that you want to us to You To talk about other than the Chiefs winning the Super Bowl again. But if you want to go to the qppowerhour. com slash resources, we have the PDF of all of our all of our prior webinars recordings and the podcasts as well as some other resources there. A little bit about the housekeeping. If you have specific topics or if it's Specific questions about the topic that we're talking about here today question about katana We do have one or two folks from katana in the Helping us out with the Q and a, but please put those questions in the Q and a itself. Please. That helps us be able to re follow up if need be, if the question is longer than the time that we have a lot to be able to talk about it today if you have just general chat. Comments go ahead and put that in the chat. And then, of course, we have the slides available links in the handouts as well something new, a couple things new that we want to talk about for 2024. We are simulcasting on Facebook, YouTube, anywhere social media that we can connect. We have a streaming platform to be able to do that. And there's no echo. So we've this is great. We're learning as we go along here. But if you register for the QB power hour series, which you can do from our website that puts you in, forever. And you'll always get. Updates of the when some, the new topic is coming out and those types of things, if you're, anti Zoom and you don't want to register for the series, you can certainly just watch it on Facebook or YouTube or anywhere that we happen to be streaming. I think we're also on LinkedIn today. So if you just happen to be doing there, say hi from wherever you happen to be watching. But if you're on Facebook, the Facebook group is where we, we broadcast that into today, so if you're on the QB power user Facebook group and you want to be part of the conversation and you type something in there without saying or granting access to to the streaming platform. It's just going to come up as Facebook user, and we won't know who you are. If we're, we want to have a conversation or call out your question or anything like that. So there's a little QR code here. You can grant Facebook, the access to the app. And then that will allow us to see who you are. If you have to say something in the chat inside the Facebook. And then also But Shawn, I thought it'd be a cool idea to do a little

Shawn Coultice: 5:26

QB power hour

Dan DeLong: 5:28

swag. So we started a little store now. I'm sorry, Shawn was not dealing with any inventory. We're doing drop shipping, so not actually preparing these things. So we'll talk a little bit about the uniqueness of that a little bit. I think maybe later but we have, I'm trying to, put together like little swag that's either power related or time related to the QB power hour get it So we have wireless chargers we have a coffee mug because everybody needs to recharge with coffee. But it's actually one of those heat sensitive mugs. So like when you put coffee in it, you can actually read it. And then as it gets cold it gets, goes back to black, which is usually what happens when you don't have coffee. It goes back to black, right? So you can check out the QR code there. You can snap a snap your phone and it'll take you right to the store if you wanted to check that out. We appreciate that. So our agenda today we'll talk about a little bit about what we have done in the past with inventory management. We've talked pretty, we've had a couple of power hours about inventory management inside of QuickBooks, but of course, now we want to focus a little bit on QuickBooks online ecosystem because that's it. Where everything is focused right now, you can't even find a QuickBooks desktop on quickbooks. com anymore. But some other additional resources the folks over at Katana have created a guide, the ultimate guide for manufacturer accounting and we'll share those resources for you as well. And then some advanced inventory workflows that might need an additional application. And then we'll take a. dip our toes in the water of what Katana can actually solve for. Let's

Shawn Coultice: 7:04

first start off with our pole.

Dan DeLong: 7:06

So with what or where to go where are the poles? Oh, I clicked on the wrong button. There they are. Okay. And they're always out of order. So there we go. Okay. What versions of QuickBooks do you currently use and support with your clients? Is it QuickBooks Online only, both QuickBooks Online and Desktop, and QuickBooks Desktop only, right? Michelle you're still coming off your teeth high, but in the past, have you With regards to, inventory management and the consulting that you've done in the past, is that something that you shied away from or ran towards? What was your take about that?

Michelle Long: 7:47

Yes, I have, because inventory can get very complex very quickly, and actually that can bring up a funny question that we could talk about, Dan, couldn't it? Yeah. Where, so okay, so we might as well talk about this. So yes, I have shied away from inventory because it tends to be very complex, and it just can get very messy and very difficult. So anyway, yes, there was a client that was doing, actually they were ordering, they were doing an inventory rep fulfillment. Where they don't actually carry the inventory. They just order it for clients and everything. But they called me and said, we want image ClickBooks online. We have this very small piece of our business. That does parts inventory. Anyway, long story short, they called me saying, we want to convert from desktop to online. We're really using desktop because they had a little piece here, a little piece there, a little piece there. Nothing was fully all in one desktop file. Long story short, their parts business, it was a small piece with millions of dollars and lots of parts. Long story short, they needed enterprise. And I call up Dan and I say, Dan, I don't want this. It's more inventory that I bargained for. How would you like the client? And and transferred them to Dan because it is the inventory. It can get very complex very quickly, but that's what I love about Katana is the fact that it keeps things easier because inventory can get very complex very quickly if you don't set it up properly to begin with, they can make a mess of it. And that's what's so important is if you can get the client and get it set up properly in the beginning and get them trained properly on how to record the purchases right and how to write off something if it gets broken or damaged or whatever. If you can teach them the proper processes from the beginning, you can avoid those problems and issues. And that I think is the key and that's why I'm glad we have Shawn here today to help us to see which type of clients are right and how to get people started

Dan DeLong: 9:46

off on the right foot. Yeah, and it was like right after we had Shawn on the first time. Yeah, I think that's what we want to talk about. Where we had the prior power hours on, on inventory and Shawn came on. So it was like fresh in your mind. I was like, oh, maybe we'll just add on Katana to all of this. But as we discovered, because they were doing drop shipping and that's not something that's right on their Feature list that they'll be able to handle. We unfortunately had to say no, it wouldn't work with with gaan, but they are definitely moving forward in the right direction. So we've had a couple prior power,

Shawn Coultice: 10:21

I can't say it, prior power hours, UV power hours on

Dan DeLong: 10:27

inventory where we had six column state in inventory. And for some reason it's showing that the video's unavailable, but it's there on a. On our YouTube channel the link's right there and then the the overview of QB inventory management with a high level of of Katana in the last October. I always get August and October confused, so I had to think that one through. So those are listed there. In schoolofbookkeeping. com we have created a new inventory course for a fundamental. Fundamentally based things that you can do inside of QuickBooks Online managing those types of things. I always break down the three major buckets of workflow of I buy stuff, I sell stuff, I buy stuff, I build stuff, I sell stuff, I buy stuff, I Put stuff all over the place and I need to know exactly where everything is before I sell different stuff So we break that down a little bit So you can access the advanced inventory page that we talk about there where we go through And have some video tutorials on that page as well and Shawn, you want to talk about the Manufacturing Accounting Ultimate Guide that you guys

Shawn Coultice: 11:37

have? Yeah, absolutely. And I think one of the things we see, and Michelle kind of touched on it, we work with a lot of accountants often When we talk to accountants, they know that their client is struggling with inventory because they see it, whether, they're working with them on a monthly basis or even annually at tax season, they realize that there's just a lot of inaccuracies within the inventory and it makes their job more challenging, but it's hard for them to address. Sort of where to begin with that client. How do we help, the client improve? And so what we put together was just the basics of what is manufacturing accounting, some definitions to just help educate around manufacturing accounting, because really when you think of the opportunity in the market, those are really the clients that are going to enable you to increase your billable rate to offer additional services around, beyond maybe just bookkeeping, potentially you can look at helping to right size their inventory and forecasting their business more effectively. By utilizing tools within a system that's really easy to use, you can actually help separate and differentiate your practice. And so that's the idea behind the manufacturing's ultimate accounting guide is to give you that base knowledge of what manufacturing accounting looks like, some of the different options and definitions help better educate you to go and provide a better service to your client. And being armed with some of those definitions.

Dan DeLong: 13:10

And it's it certainly is robust. It's not just a really skim scratch the surface of that, cause it, it does go pretty deep into some of these topics, so appreciate you making that available for our folks here. Now we did talk a little bit about last time, the tracking of inventory and really the workflows that work well for tracking inventory inside of QuickBooks online is the Reseller model, right? Where I buy stuff and then I sell that very same stuff. I don't do anything to that stuff in between the time that I buy and sell, because you have the features and the functionality are pretty good at that. Being able to track those things. But. Any additional nuances that, that go along with the inventory management practice of that, it gets a little, yeah, but, where you throw a lot of those things in there, like it available quantity, so we're still waiting for a sales order, to come to QuickBooks online. We'd love to have that, we'd love to have multiple units of measure where you buy. In one quantity and you sell in another. It's just simple math when it comes down to that functionality. But it does have skew, right? So there is a stock keeping unit field to be able to do that. And there is reorder points. And one of the things that I've always said about QuickBooks is is one of my Danalogies is. When you're driving down the road, you have a windshield and a rearview mirror, right? QuickBooks is a really good rearview

Shawn Coultice: 14:44

mirror.

Dan DeLong: 14:45

But there's so much more space and there's so much more to do out the windshield, right? That's where you're going. That's where you're headed. That's where you gotta look for obstacles that are coming

Shawn Coultice: 14:56

your way. But QuickBooks is

Dan DeLong: 14:57

really good about looking back at what you've done. You've run some pretty Powerful reports of what you've sold and what those types of things but

Shawn Coultice: 15:07

as far as like the moving forward

Dan DeLong: 15:09

Component and that's where we're we'll try to focus on what you can do moving forward You know, where's the windshield in katana? Because those things knowing them almost Instantaneously is only going to make people in businesses be able to make smarter decisions based off of that information rather than, at the end of the year, at the end of the quarter, they take a physical count like, oh we just we broke a lot of stuff this year. What should we do about that? So that's the type of inventory tracking that you can do inside of QuickBooks Online. There's a lot of things that it doesn't do, right? The current gaps, you want to talk a little bit about About this, John. This is your slide, right? But

Shawn Coultice: 15:54

yeah, and I think these are just things that we hear from accountants and customers that have been on QuickBooks. Maybe they're on desktop and they're moving to QuickBooks online, or maybe they're on a more complex inventory solution, and they're just really having a hard time utilizing it in their business. They need something that's Relatively easy to use, but solve some of the major challenges that the businesses faced with, whether it be having multiple locations, or maybe they're selling across multiple sales channels, maybe they have a bill of material or multiple units of measure. And so with that, you have this sort of advanced inventory management where a business, if they were to try and run through QuickBooks online. Inevitably what they end up doing is running heavily in Excel and a lot of the business operates in Excel and the business isn't connected. So you have your purchasing individual really not adding visibility of what's going on, where the marketing or the sales team is focused. And then the actual inventory and warehouse is basically a black hole. They just have no idea what's going on back there. And often the story I hear is. As a business owner, I only know what's going on actually in my business once a month, and that's at the end of the month and then everywhere else. You know the financials, the inventory values. I really don't know. So you can imagine as a business owner how difficult it is to make investment decisions, marketing decisions when you really don't have that full picture of information. And really, that's when you start to get into a business that's slightly more advanced, needing production planning. Maybe the ability to sell across multiple sales channels and just having that real time information across the business, it just helps that business owner make better business decisions so that they can see through that windshield and avoid those obstacles and, continue to scale their operations. Perfect. Now we're

Dan DeLong: 17:45

gonna throw out our second poll, which is what type of inventory clients do you have? And again, zoom is going all over the place with where are the polls? Where are the polls? So just check off, some of the inventory management. Types of workflows that you've seen in the past, if you do have those, or maybe you just don't, maybe you're like Michelle and go run streaming from anybody who has inventory. But I

Shawn Coultice: 18:10

think Michelle's coming around. I think she's coming around. I think one, one of the

Dan DeLong: 18:15

Sorry, go ahead. Let you start your Shawn, if you want to start sharing from your slides Okay.

Michelle Long: 18:21

But Shawn, that makes a good point. Shawn makes a good point though. And that's one of the things I love about Katana is Katana works for your bigger clients, like the one Dan and I were referring to that the parts business, was. They're a big, they're a big company because the parts that they said was a small piece was still a couple of million dollars, so they're a bigger client and Katana works great for bigger clients and everything, but that's one of the things I love about Katana, too, is that it also works well for the smaller businesses, too, where their inventory needs may not be as complex or anything, but they still need something to track inventory and they still can afford it, and that's one of the things that I love is that Katana can meet the needs of smaller growing companies Because they can afford it and get started right because that's the thing that bugs me is where You know, they make a mess of everything and stuff But that's what I like is katana can get him going and start it correctly and it grows with them As they grow the business and stuff. So I think that's really awesome.

Shawn Coultice: 19:21

Yeah, and I think one of the one of the Aspects that created this complexity around inventory. Certainly there are more complexities than just a business that buy and buys and sells things with they were manufacturing, or they have more requirements from that perspective of tracking and organizing their inventory. But the actual technology itself. Is what created the complexity, usually it was this on premise ERP solution, or you have this like really difficult to use inventory management package that was hard for the accountant to really understand what was going on. And so where Katana fits into sort of that bucket is very similar to QuickBooks Online. It's an easy to use cloud based solution that you really understand quite quickly and intuitively what's happening and why things are the way they are, where to go and get that information and how the processes work within the system. So I look forward today to actually opening up to Katana and walking through some of those processes to help alleviate some of those concerns. But, even someone as basic as me, I don't even know how to put this Google sheet into PowerPoint presentation or presentation. Where's that button?

Dan DeLong: 20:36

Usually in the upper right where it's got a little slideshow.

Shawn Coultice: 20:40

Oh, there it is. Okay. I had it like hidden. Okay, so slideshow. There we go. Look at that.

Dan DeLong: 20:45

Leave it to Google to to hide things on you.

Shawn Coultice: 20:49

There we go. So we'll first define what is Katana and you probably have gleaned into this a little bit through our conversations, but Katana is a cloud based inventory management platform that provides live or real time information into inventory, production, accounting data. As well as reporting on that information, which allows business owners and businesses in general to make decisions based on that real time information. So they're making more informed decisions based on the information that they have in front of them with Katana. And so let's talk a little bit about who is a good fit for Katana. So Katana what is our ideal profile of a customer? So often our customers, if we look at the technology stack they often are using either QuickBooks online or zero. I noticed that there was some other when people were selecting what. Technology they worked with. So we do work with zero as well. But it's the QuickBooks power hour and the majority of our clients are certainly on QuickBooks online. It would be something around 70 percent of our clients. So we've been pretty heavily focused on that and building out that integration really strongly. The other solutions that we work heavily with would be mainly Shopify. So that e commerce world. So Whether you're selling your business or selling your products for your business online through Shopify, Amazon, WooCommerce, BigCommerce, we integrate with those solutions. And so often, I think it's something around 80 percent of our customers are using an integration with QuickBooks Online and or Shopify. So you can get a picture of that technology stack. They've got products, they're selling it on multiple sales channels, and they're using. On it to help them pull in that demand, manage that inventory and fulfill those orders, and then shoot that information over to their financial solution in QuickBooks online. And when we look at the size of those businesses, we really work with businesses between. Typically around 1, 000, 000 in annual revenue. We do have quite a few that are under 1, 000, 000 in annual revenue and then up to even 250, 000, 000 in annual revenue. Our sweet spot today is probably between 1 and maybe 10 in annual revenue. As you start getting, further up the market. There is business complexities that can get involved, but because Katana has this open API, we can really integrate with a lot of different workflows and processes and add value to even extremely large businesses or, mid sized businesses. If you're looking at like the definition of a 250 million customer, and we have quite a few of customers in that range. Yeah

Dan DeLong: 23:28

your your options that you have, like that's a big. Range of, revenue, sweet spot, but it's not just one, one size fits all for your solution, right? It's it's almost like a menu that people can, start small, grow big, add things on, add functionality, right? It's not just like one flavor, right? Just like QuickBooks has. Simple start essentials and plus an advanced, you have something similar. You have a menu or flavorings to choose from.

Shawn Coultice: 24:03

You've got it exactly, Dan. So when you look at Katana, one of the things that we wanted to focus on and what our customers told us as well as what our partner told us is they want to utilize an inventory solution that they aren't paying for stuff that they don't use and that they get the most out of in their business. So Katana's pricing model is actually unlimited users, unlimited integrations and unlimited SKUs. So that allows the business to scale. And then we right size the solution business. Based on what the requirements of that business is. So it starts at 179 per month on our starter plan. We have a standard plan that most of our customers are on that gives some of that more advanced functionality and features associated with it that comes in at around 350 per month. And then we can go all the way up to businesses that are quite large, utilizing the system at around 1, 500 per month. So it really depends on the business requirements that help determine. What they will need within the solution and what their price point is, but it is right size based on that business's requirements. So they're not paying for stuff within a solution that they don't use. And with that unlimited user model, it really allows their entire organization to take advantage of that solution. And I think that's a huge feat aspect that often when I was doing implementations and you were saying, Oh you got to go and add another five or six or seven users. The business would be like, okay, adding up the numbers. Geez, that's going to be another 500 a month or whatever the cost might be. Whereas with Katana, you don't have to worry about that. Get the solution in the hands of all of your employees. So you have more data, more control and more visibility over your entire business. So speaking to the industries that we have success with, often we're having a lot of success in the food and beverage industry because we have. Great batch tracking and traceability to meet compliance requirements in those industries, furniture industries, cannabis related industries. We have a lot of success in businesses that sell like oils or trinkets. They might be in the cannabis industry, but they have those infuser smelling. Things that smell great. Traditional manufacturers, the machine shops, metal fabrication shops work well with Katana apparel companies and electronics and computer companies. So all these businesses have something in common in the fact that they manage inventory, they have products, they're probably selling them online and integrating and using QuickBooks online as their financial solution.

Dan DeLong: 26:31

So if you build. Furniture out of upholstery made out of canvas. That would be like the ideal.

Shawn Coultice: 26:40

That is the ultimate ICP customer. Yeah, exactly. So that's the hemp furniture company. Exactly. There we go. So this is just an image of. subsectors. And so you can see Katana is relatively industry agnostic, much like QuickBooks Online is. And we try and provide feature sets that are easy to use. And then if they do have specific tools or functions that are required within that industry, that's where that open API can come in and we can actually integrate or we can have a partner build something. Custom for that individual company that needs something specifically for that furniture industry that maybe is some sort of configurator or quoting tool that they're utilizing. Shawn, can I ask you a question here? Absolutely, Michelle, go ahead. And

Michelle Long: 27:29

this might be too specific, but what about a window manufacturing where each window can be different sizes? Is that too? Industry

Dan DeLong: 27:39

specific.

Shawn Coultice: 27:41

So windows are an interesting one. So I actually spent some time in my career, I was worked at a door manufacturer. So very similar to windows because they have this multidimensional, but windows are even more complicated because they're not only rectangles, they can be arches and all that kind of stuff. And so windows are particularly complicated and that likely would need a. Custom software if we're doing any sort of the quoting in there, but let's say they had a quoting tool that they used to figure out the windows. We could import the quote, the bill of materials, all that stuff through the API, and then Katana can manage their inventory. track their production costs, have their accurate cost of goods sold and help from that perspective. So can we work within the windows industry? Absolutely. We do have customers actually within that space, but it really depends on what that with that customer is looking to solve for. And one of the challenges. within that space is often the configuration of those individual windows because there's so many different options and choices. It's basically unlimited. And so with that, within that industry, I would say we can't do probably the quoting and configuration options, but we could integrate with something that does. Pull in the materials and the requirements for that to help them track their inventory and fulfill those orders with accurate job costing.

Michelle Long: 29:06

So Shawn, when somebody like me, who's not an inventory expert, and I, say I have a client like this, and they are using a third party app that, anyway, long story short, when somebody like me says, I wonder if Katana can help in a situation like this, and I'm not right sure, not everybody has a Dan that they can reach out to, I am very lucky in that situation. Can they contact you guys and will you guys help them walk through to figure out is Katana a good fit for their

Shawn Coultice: 29:33

client or not? Yeah, and I think that really speaks well into this slide So when we look at the different types of solutions out there in the market Katana really is unique And one of the ways that we're unique versus some of the competitors in the market is we really are open From a support perspective, especially with, potential partners and accountants and customer partners like that. So reaching out to Jason, myself, Justin, we have a whole team of people that just work with our accounting partners to help answer their questions and make sure that. They have the answers they need to get back to their customers on time. We're not going to put them into a position that's potentially going to be risky for them down the road. We're going to be completely honest and transparent about what kick tonic can do, what the limitations are, what the opportunities with that client might be. And from there, we'll work with them directly. For the client would even get on the call with them and the client to talk through what the requirements are. And if the client was interested, we could then set up a more detailed demo with our sales team, where they can walk through the software and have a really good understanding of what it can do for their business. So to answer your question, we have the team and resources in place for you to reach out, propose. the opportunity, what the customer looks like, and we can let you know, is that a good fit for Katana? If it is, why? If it isn't, why? And we can take it from there. Awesome. That's what I

Dan DeLong: 31:01

appreciate. And that's what I appreciate about Dishon is that, you're not like, Hey, everybody's got to be on Katana. You're self aware enough to know where What lane you occupy and what, where your sweet spot is, but not necessarily, discounting your competitors because they may do something better than you, right? And that's a fantastic mindset to be in.

Shawn Coultice: 31:26

Absolutely. I think where Katana does well is we're a really easy to use solution that offers tools that allow a business owner to make real time business decisions and keep their inventory accurate and in sync with their financials. And so that approach to the market is really in line with QuickBooks online, and it's really in line with Shopify, and that's why we're seen as key partners with both of those companies so that they see Katana as a strategic partner, because we really align well with our go to market strategy and providing best of breed technology that's easy to use that company can get up and running quickly. In our perspectives we have excellent support. It really is a differentiator of us as well as complete honesty and transparency. It's something that we hold as one of our core values within Katana is being completely transparent. So this kind of gives you an idea of where Katana, the lane we swim in, right? So we're not that all in one ERP. We're not that overly complex on premise inventory solution. We're an easy to use cloud based solution. And we'll dig in, dig into it shortly here within the software. Did you, can you speak to a little bit about some of

Dan DeLong: 32:38

the acronyms that float around with, eRP, MRP IMS what is the,

Shawn Coultice: 32:45

there's so many of their MES and there's a, there's just a really a time and some of them, I don't even, I don't even know where they come from. Someone said one the other day and I had, it was it actually, and we're our product roadmap. They had a thing there and I'm like, I don't even think that's a real acronym. We just made that one up, but but so ERP stands for enterprise resource. planning. And so E. R. P. Essentially, when you look at a net suite and S. A. P. Microsoft Dynamics, the idea is that solution covers the entire enterprise. So with that, they are looking at a financial suite, manufacturing, inventory, C. R. M. Solution all within that one individual package. And I worked for a company for years that was an ERP solution, and the challenges with an ERP solution, when you would go and implement one of these solutions, often the customer would utilize maybe 10 percent of what that ERP solution offers, because there's so much that it can offer, but they're paying for the whole solution. So by going at it from a best of breed approach and why QuickBooks Online can now even go further up market is because they're approaching the market in the same way where they can say let's be the best. Online inventory or sorry, online accounting solution and integrate with the best of breed solutions in the market. So as the consumer is able to select the right technology stack for their business and not add pieces of technology that they're not going to use and just adds complexity to their organization. So that's the ERP bucket. Is that full enterprise sweep and then IMS is inventory management solution. You'll often hear, and so there are on premise solutions. There are more complex cloud based solutions as well. And I feel as though the majority of those solutions focus on feature before workflow. And what I mean by that is they might have all the features that a business needs. But do those features actually fit within the workflow of that business? And that's where the usability comes in as an important thing to consider. And how likely are they actually the business to get it up and running and work within their current workflows. And so Katana takes the approach of, we see ease of use as our differentiation from a feature perspective and fitting within the workflows that a business

Dan DeLong: 35:17

operates within. and we definitely wanna make sure we give the star of the show, the product that we can, that we get into it here. Okay. There's all sorts of terms that we could talk about. And I'm sorry I diverged us into that. But let's continue.

Shawn Coultice: 35:32

Yeah, absolutely. Thanks for keeping me on track. Some of the struggles you'll hear businesses talk about, and I've touched on it a little bit. One of the main things that I hear is real time inventory. So do they have accurate information within their business to make those decisions? And often your demand compared to what you have in inventory, to what you're buying and what you're making, those are all disconnected. And when they're all disconnected, you're not making decisions based on what's actually happening within the business in that moment in time. And therefore the business tends to have more inventory than they need to carry. And they still run into situations where they run out of stock and they can't fulfill certain orders and their lead times get long. So that's one of the biggest challenges businesses are faced with today. And from accountants, one of the main things that we hear is cost of goods sold. Businesses don't know. How much it costs them to produce or sell a product. And what Katana does is it allows you to have very accurate costs of goods sold and think that costs of goods sold directly into QuickBooks online. So those are the two things that I think really land well as real time inventory management, accurate costs of goods sold and having efficient business processes. That's really some of the things that businesses are looking to solve for. And so how Katana helps with this, we'll dig into the software here, but we've got real time inventory. We've got built in purchase order flow. We can integrate with all those different sales channels that the marketing teams are trying to, scale the business through. We've got direct control over those marketing operations or sorry, manufacturing operations. It's really easy to use. And then we integrate directly with that financial solution. So when we talk about the financial solution, we'll get into the specifics, but Katana integrates at the balance sheet level. So when we look at a sales order, we can push that over to the invoice, and that's going to make a journal entry relative to the the, so the accounts receivable and the sales account, and then we'll also have your inventory account and your cost of goods sold being hit. Within that transaction on the purchasing side, you're going to be able to increase your cost your inventory relative to the value that you're purchasing that product that within QuickBooks online, and you can even add landed costs directly into Katana, and that will update that costs over. Into QuickBooks online as well. So we'll get into the details. You can also sync like stock adjustments can make a summary journal entry. You can also add your, in your labor costs over into QuickBooks online as you're adding operational costs to your finished product. So those are things that you can do within Katana, but that's something that's going to help your client have more accurate financials. So we integrate with QuickBooks, as I mentioned, and just to make sure we leave enough time to go through the software, it's going to tell a customer story that's using QuickBooks online and and also Shopify, GJ Motorsports, really cool customer that the owner every night of the week, he would essentially go in and have to manually count his inventory. It took about an hour every day. And so he said. He no longer had to wait till everyone had gone home and come in and count his inventory to keep it accurate. He was able to completely eliminate that because his inventory was now accurate with Katana in place. So he saved himself four hours of working in the evenings by implementing Katana and it really helped them grow and actually extend their product offering. So it helped that business scale when they got control over the inventory. So pretty cool story. So let's dig into the product itself now. So I'm going to stop sharing because I have to share the thing here. Oh, I was actually sharing my screen. Let me go back. Always the fun part of

Dan DeLong: 39:31

when you stop sharing and then everything resizes and

Shawn Coultice: 39:34

where to go. All right. So can you guys see me? Okay. Yes. Yep. All right. Perfect. Sounds good. And the real star Katana. So we're just we're just logging in here and you can see as I'm logged in, I'm just operating in a browser. Okay. So I'm using Google Chrome right now, but whatever your preferred browser is, Katana will operate within. And we can see here, I've got a bunch of sales orders listed out. And so what we're going to walk through today is I'm going to talk through how the orders come into Katana, how we then take that demand and those orders, and we plan maybe our manufacturing and what jobs we want to run. Maybe we want to look at what we want to buy. So what we're going to buy based on that demand, we'll look at how we can then schedule our shop floor and assign tasks to individual employees and track. Those jobs through production. Then we'll look at how we're going to pick that order against a pick list and then ship that out and invoice it over into QuickBooks. So that's the workflow we're going to walk through today. So Dan, feel free to stop me and ask any questions or Michelle as we're going along here. All right. So

Dan DeLong: 40:46

lead the way.

Shawn Coultice: 40:47

Perfect. So we can see here Katana, we use this stoplight feature on the front of the page. And I don't think there's any other systems that give this type of visible information right on your sales order screen. So as a sales rep, I can go and see all the sales orders that have come in. They can come from all those different sales channels. They might be from Shopify from Amazon, and you'd see actually where they came from. Okay. In a little column here, if they had been imported from Shopify, there'd be a little link there and you could actually click that link and it would open right up to Shopify, similar to what we'll show here within QuickBooks online. I can see here with all of my different sales orders, what I actually have available. So I can see the sales item here, whether I have it in stock. So yellow means that. I don't have it in stock currently, but it's on a purchase order or it's on a manufacturing order and it actually identifies the date that I expect to receive that or have that available in my inventory. Greens means I have it available and I can go and in this case, ship it out or pick it. I also have a red which means that I don't have that currently in stock, and I haven't created a manufacturing order or a purchase order for that item. So that's on the finished product, the sales line items that are on that individual sales order, you then have your list of ingredients. So the things that go into the finished product, Katana allows you to actually see, do we have the ingredients available? In stock to make the product that we're looking to produce. So that's a really excellent thing to be able to understand. We need to go and buy stuff to make the finished products that sales order is calling for. And then have we created a production job? And if we have, I have the ability to go and look and open that up so I can see that this job is currently being worked on. There's actually three separate manufacturing orders associated with this. And I can click on any one of these and drill right into that manufacturing order, see who's working on it, what workstation it's at, how much cost has been associated to it very easily within the system. That is a,

Dan DeLong: 42:53

That is quite a dashboard, right? That gets you like easily to see, and then be able to drill in. I think that is one of the things that I think you guys do really well is. That plan now, I can't help but notice that there are draggable things on the left side. I don't know the 9 blockers or in your case, 6, you can move these things around and there's

Shawn Coultice: 43:17

a priority here. Yeah, exactly. Great story. So Peace Collective, one of our, one of our customers in Toronto here they have a couple of really important customers and when they ring them up on the phone, they know that they got to push their orders to the top because they're their repeat customers and they got to make sure that they're fulfilling their orders. And so when that important customer calls Peace Collective, they go ahead and they drag that sales order that just popped in there and they drag that right up to the top. And that's actually going to reprioritize the inventory. That's being allocated to those jobs as well as right on the shop floor when an employee is going to manufacture a good or they're going to pick it, it's going to prioritize those jobs relative to how you prioritize your sales orders. So it's communicating not only what inventory should be allocated to these jobs and planning it out appropriately from that perspective, but also in real time, those employees on the shop floor are seeing on their device, what is the priority of jobs that they need to work on? We've got our sales orders in the system. We've got them prioritized. Now what are we going to go and do? Let's take a look at our forecast. Let's take a look at how many weeks of inventory we currently have on hand. So if I go over to my planning tool here, I'm able to actually see we had a little pop up here. Inventory planning and forecasting is a brand new feature. So this allows you to actually see somehow I'll shut that zoom in my way. There we go. Get out of here, Chris. So we've got we've got our products right now. I'm looking at all my inventory items, but products are things that I sell. So I'm looking at all the things that I can, I'm selling right now. And I'm able to see how much. Inventory I currently have on hand and when it is red, that means that I ran out of inventory or I'm going to run out of inventory based on the demand that's currently in the system, the orders that I have, whether it be a manufacturing order or purchase order to backfill that as well. So it really gives you that visualization of how many weeks of inventory on hand do I currently have? And we have that for products as well as we have that for materials. And so from that, it gives me a replenishment option. So I can then go and say, okay, what do I need to go and make? Or what do I need to go and buy based on where my inventory currently sits? So right now the system is identifying to me, my television stands and my coffee tables. You need to go and make this because you don't currently have enough based on the demand in the system. The amount of inventory you want to keep in stock and how much you already have on order or already have an open manufacturing order. So very quickly here, I can hit make and go and create a manufacturing order. So I can go on in this case, maybe I want to make five of these. I can create an open up that manufacturing order right from this page. Yeah. This year

Dan DeLong: 46:19

it's going to be phenomenal. There's a phenomenal windshield, right? So this gives you a lot more forward moving planning. The ability to change things around by prioritizing what's important to, to the inventory management at this point. I'm like, as you're showing this, I'm like,

Shawn Coultice: 46:38

how would you even possibly

Dan DeLong: 46:40

do that inside of quickbooks? At best, you're going to see a stock status report.

Shawn Coultice: 46:45

And maybe make some purchase orders from that,

Dan DeLong: 46:48

if you're using QuickBooks desktop, the ability to change things around and see like on a weekly basis, this is when I'm going to run out of this thing and you're going to be able to, plan for the lead time that it takes to, to get that into there as opposed to, oh, goodness it's just, it's going to, we're going to run out

Shawn Coultice: 47:11

at some point. Yeah, exactly. And we work with a lot of clients that have busy seasons, right? Whether it's Cyber Monday they're busy, they're they make manufactured Christmas lights, one of our customers. So you can imagine their business gets pretty busy for a certain part of the year. But, other than maybe, in, in in, in, in Mardi Gras, they're not selling too many. Yeah. They're not selling too many pairs of Christmas lights. They need ability to forecast out and plan out their inventory. And that's where Katana can add a ton of value in planning for those busy seasons, whatever they're going to marketing with or to market with and making sure they have the inventory in place to capitalize on what they're investing from a marketing perspective. So that's where you're connecting those different. Areas within the business. Michelle, did you have a question?

Michelle Long: 48:00

I do. And you might have mentioned it and I missed it for a second. But once the order is like finished and ship, is there a way for the customers to be able to track that to see or even to track the status? Is there any way for the customer to have any visibility? To see, oh, wow, they've started on my order and it's in process now. It's expected on this date. Is there in, that would just be cool. I know I enjoy seeing that Oh yay. It's expected on this day. Yeah, for sure. So

Shawn Coultice: 48:33

we do perspective. Yeah. And so there are certain ways that we could provide that information. So they would likely be tying into something like a ship station or a shipping tool that is actually connecting to the shipment tool. But what the API in Katana allows you to do is track statuses. So what you'd be able to track. So if I go back to that sales order screen and we look at the. delivery mode here. So for example, you'd be able to see that it's not shipped. It's been moved in this ready for packing status. It could then move to it's been packed and then it's been delivered. So meaning that it's shipped out of Katana. So those statuses are all available within the API. So if. Our customers. So that would be the manufacturer. Anyone on this call, their client wanted to provide that information to their customers. They could on their website and link to that via the API, there would be some custom work involved with that, but certainly available to them. Okay. Great.

Michelle Long: 49:37

You're showing your client asking about that one time. Thanks.

Dan DeLong: 49:40

And what you're showing us, Shawn, this is live. Today, right? This is what people would get if they were to get it today. Or are you showing us some sneak preview that won't happen for the undisclosed future? No, this

Shawn Coultice: 49:52

is live. This is ready to go. This exists. We have we have around 1700 customers that are utilizing Katana today across the globe with the vast majority of those in North America. So we have many customers using Katana in real time. And Katana is a. A multi tenant SaaS based solution. So what that means is all of our customers are actually on the same version of the software. So as we release new functionality, we are continuing to develop the product and gather feedback and improve integrations and improve workflows. That automatically is available to those customers as they're on the subscription of the solution. And all of our customers are running on the same version of the software. Now we only have

Dan DeLong: 50:41

five minutes left and we may run over a little bit on our power hour and the QuickBooks, what happens in QuickBooks always gets the short end of the stick here. And that's what people are really wanting to know is, all this stuff that you've done here, how does it show up in the QuickBooks? You mentioned journal entry and we talked before it was sales orders going to invoices. How does this show up and what workflows would I be Losing if I were to connect, it's not in my QuickBooks online or my client's QuickBooks

Shawn Coultice: 51:11

online. Yeah, absolutely. So great question. So when we look at, for example, why don't we go ahead and look at a done sales order? So let's assume we won't get into maybe because we don't have enough time, but I'll just quickly and we'll drive into. So you have the shop floor control capabilities to track jobs. And the reason I bring this up is that accurate costs of goods sold. So how do you know how much something costs? How do link that to what guys are working on or people are working on the shop floor? That's through this application. That's actually tracking how long they're on jobs for. So they're currently running, for example, the table saw. And so we can track how long they're on that job for. And as that job is completed, that's updating that cost of goods sold. And then assigning it to someone to go and pick that job so that we know that, Hey, that order has been picked and it's ready to go and ship out. So those are apps that are often used in a mobile device. So you can see what that might look like. It's often ran on a mobile device and they can go and say, I'm ready to start picking this order. They go and click into it and they can go and start picking the dining table. And it would show the bin location of that particular item right on the shop floor. Shortly, we'll be releasing the ability for them to just scan a barcode to pick that item as well. So when we go and complete the order and ship it out, if I go over to the done page, we can see I've got a couple of sales orders that have already been invoiced, but they're currently unpaid. So when we look at that individual product, We have that we have different categories of product and those are going to be associated to different sales categories over in QuickBooks online. So if we were to go and look at, for example this invoice in QuickBooks, I gotta sign in. Sorry. Code.

Dan DeLong: 53:03

I didn't get a code. I did this

Shawn Coultice: 53:06

just before. I don't know. I

Dan DeLong: 53:08

believe you. I think everybody here is I feel your pain, Shawn. I knew this. At least 14 times a day.

Shawn Coultice: 53:19

All right. I'm sure it'll work. There it is. It's on a 2024.

Dan DeLong: 53:27

Okay. Boom. It opens up the exact transaction.

Shawn Coultice: 53:34

It does open up the exact transaction. So sometimes when I, let me just do that one more time. For some reason, when I first opened up QuickBooks to the transaction level, it I don't know why it doesn't load in the there they are. Okay. So let me move your face, Dan. Oh, sorry. All right.

Dan DeLong: 53:55

Wouldn't be the first time my face got in the way. But here you see the invoice and it's got the product on it. As you mentioned earlier, a journal entry, I was like, wait a minute. I thought you were talking about it. Creates invoices with items. Now these items are not inventory items because you're not tracking the inventory inside of QuickBooks Online. They are, as you call them, dummy items, right? They're items that have that detail on them, but they don't impact inventory by the item itself. But you have it as an invoice. So if you're using, QuickBooks payments or using QuickBooks to do your invoicing, you can still use that functionality to be able to you're not cutting off a workflow by adding another application that doesn't integrate into those workflows.

Shawn Coultice: 54:44

Absolutely. And really what we wanted Katana wanted to do is differentiate those functions, right? So Katana is your operational tool. That's your forward thinking. Class the invoicing is really on the finance side of the business. And so even from a controls perspective, the individuals that should be able to access and create invoices and accept payments and all those kind of things should be the people that have access to QuickBooks online. So You will need fewer people likely to access QuickBooks online in the business, which hopefully gives you better control over your financials as those individuals are actually operating more commonly within the operational tool, which is Katana, managing their inventory, their sales orders, the purchase orders out of the solution, and just pushing those invoices or those bills over when a purchase order. Or a sales order is created and you can see that transaction journal here. So if I go and click into the transaction journal, it's going to make a, your Oh, sorry. There was a poll that popped up here. So I wanted to get the last poll

Dan DeLong: 55:51

in there while you're talking about this. Wonderful.

Shawn Coultice: 55:54

I love it. So we see our sales order here. We've made a AR, a debit, and I just set it up as an other income credit account. So you're associating the category of that product. To a particular revenue account and that you can associate, different categories with different revenue accounts. So then you can have, you're reporting all all those capabilities out of QuickBooks online in there. And then if you're looking at it from, let's say a let's say like a journal entry related to your inventory. So it's going to make a cost of goods sold entry. What was the sales or 36? So very similar

Dan DeLong: 56:37

to, some of the other, some of the other applications that will account for the cost of goods sold by creating a transaction that will account, have that. financial impact of that of that activity. Now, does it do it on a per transaction basis or kind of like at the end of the day when those things

Shawn Coultice: 56:57

come over? So today the only option is to do it on a per transaction basis. You can go in and multi select. So if you wanted to go in and say, create all your invoices at the end of the day, you could go and say I want to look at all of my Invoices for a current day, or you wouldn't do over seven days, but, and then you would select the invoices and then you'd say invoice selected. So you batch selected the sales orders that you now want to create the invoices for you'd hit invoice selected, and it'll go through and now create the invoices. in QuickBooks Online relative to those individual sales owners. Great. Now

Dan DeLong: 57:40

is there anything else that you have to show us today? I don't want to cut you off, but I do need to cut you off.

Shawn Coultice: 57:46

Yeah, no problem. I'll let you cut me off. The insights and tools around dashboards are extremely powerful as well. But I think one of the highlights I just wanted to get across today is we have that. Real time control from demand through to managing your inventory, through to creating your purchase order, having that accurate costing, rolling that all up in your cost of goods sold in real time to QuickBooks Online as those invoices are being generated through your sales orders. And really creates this really to easy use workflow that your customers and clients will be able to. Gravitate to adopt and get up and running quickly and use it across that entire organization because we have unlimited users associated with the plan. So that summarizes

Dan DeLong: 58:32

it. Thank you, Shawn, for joining us and taking us hopefully, Mert he was saying. That our deep dive was more of a snorkeling and hopefully we did dive in a little deeper than than what we were glancing over on the surface. Appreciate you joining us here today, Shawn and Michelle. Always good to see you and your red and yellow but next time on the power hours, we're gonna Oh, so if you need if you go to our website you can schedule time with Shawn or Jason to get a free 1 hour training on, I'm Katana. So appreciate you if you're doing that, but next time on the QB power, we'll hope we see you in a couple of weeks and who knows where we'll be then I don't know where, but

Shawn Coultice: 59:18

every day and we'll see you next time. Thanks everybody. Have a great day.