Is your organization currently struggling to keep track of the different types of vendors you pay?

Do you need the ability to segment your vendors in QuickBooks Online?. In this tutorial, I am going to show you how to create vendor types in QuickBooks Online to track the different suppliers you pay without messing up your chart of accounts.

Hi guys, this is Samohay. One of the great features QuickBooks Desktop has is the ability to use the vendor type feature to segment the different types of contractors and suppliers that you pay on a regular basis.

This feature does not exist in QuickBooks Online. To replicate the vendor type feature in QuickBooks Online, we are going to use a custom field. There is one caveat to all of this. As of the time I am recording this video, custom fields for vendors only exist in QuickBooks Online Advanced subscription.

Therefore, to do everything I am about to show you, you must be using QuickBooks Online Advanced subscription. If you are new to QuickBooks Online, use my partner link in the description box to save 50% off QuickBooks Online Advanced for one year.

If you are a 501(c)(3) nonprofit organization that is currently using QuickBooks Online Plus edition, you can visit accountingerrors.com to upgrade to the QuickBooks Online Advanced edition. See the link in the description box for more details.

So, in this tutorial, I will show how to create a custom field to track your vendor types in QuickBooks Online Advanced. I am going to show how to apply the custom field to your vendors and demonstrate how the information appears on your expenses forms and reports.

To create a custom field, click the Gear Icon, and select custom fields. Click create custom field if this is your first time creating a custom field. If not, just click whatever button appears on your screen. Click Add field and select Vendor Info. The field name should be called Vendor Type.

Select the dropdown list as the type. Add as many lines as you need and enter your dropdown options in the order you want. As of now, there is no easy way to rearrange the order of your dropdown options once you have entered them. So I recommend adding your options in the order you need them and also make the names generic to grow with your organization.

Check the boxes next to use on PO and use on other expense forms. Once you are done with everything, click save and close. Here is the custom field that I created.
Now, let’s apply the custom field to our vendors. Going to the vendor center, you will notice there is not a batch action function to make it easier to apply the custom field to multiple vendors, at once. So, I recommend applying the custom field to your service vendors first and come back later and apply the field to all of your other suppliers.

In our vendor list here, click on a vendor’s name and select the edit button to open up their profile. Scroll down to add the custom field and click save. Repeat this process to add the custom field to all your vendors. This process should probably take you no more than 30 minutes or less to complete. Now, let’s look at an expense form to see how the custom field is displayed.

I am going to create a check by clicking the + New button and select check. Let’s search for a vendor’s name. You will see that the custom field appears here. This is a nice reminder when you are recording a transaction to remember that this is a service provider so you put the expense in the right category.

So, I am going to record this transaction and record some bills so we can see the impact on different reports. The custom field that we applied to the expense transactions will only show in reports that you can customize the columns. It doesn’t show in your standard financial statements such as your Profit & Loss, Balance Sheet, and Statement of Cash flow.

When I did this offline, the custom field only appeared on the Vendors Contact List report, Unpaid Bills report if you enter bills, and the Transaction List by Vendor report. I am going to run the Vendors Contact List report and customize it to show you the custom field. I am going to run the unpaid bills report in a separate tab and customize it to show the custom field.

I am going to do the same for the transaction list by vendor report. The transaction list by vendor report will be the option to use in addition to your standard financial statements to give your committees or management team that extra details to understand what makes up the legal and professional service total amount on your profit and loss statement.

If you want to see custom fields for vendors applied to more reports including the financial statements, I recommend clicking the gear icon and submitting feedback to Intuit so that they know this is something you want to see. So this is one way to use custom fields to track additional information and segment your vendors without making your chart of accounts excessive long and complicated. Let me know in comments what other ways your organization is using custom fields or what QuickBooks Online topic do you want me to cover next.

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