How do Classes Differ from Customer, Job, and Vendor Type
In QuickBooks, you use “classes” to classify transactions. Classes can apply to all transactions and are not tied to any particular customer, job or vendor. You can use a “type” to classify your customers, jobs, and vendors. If setup properly, you will be able to get a lot of useful information by type. For instance, if you want to report and analyze your financial performance to see where your business comes from and which type is most profitable, categorizing your QuickBooks customers and jobs is the way to go. Using both customer and job types can help you produce a report of kitchen remodel jobs that you’re working on for residential customers. If you run a construction company, knowing your commercial customers cause fewer headaches and that doing work for them is more profitable than residential jobs is a strong motivator to focus your future marketing efforts on commercial work. If you take the time to think of types in advance, you’ll save hours of effort later, when you need the information about your business.
Note: Depending on what industry you selected during setup, QuickBooks fills in the Customer, Job and Vendor Type List with types that are typical for your industry. However, you can simply delete these suggestions and replace them with your own entries.
Customer types let you categorize customers in ways that are meaningful to your business. You can set up customer types to indicate which industry a customer represents, how a customer first heard about your business, if the customer is a reseller/direct buyer and a customer’s geographic location. Examples include: Wholesale/Retail; From Advertisement/By Referral; and Commercial/Residential/Industrial.
You can create financial reports and do special mailings that are based on your customer types. For example, if you use customer types to categorize customers by location, you could print mailing labels for all the customers in a particular region. You can also filter reports by customer type.
To Setup a Customer Type: You can create customer types when you set up your QuickBooks company file or at any time after setup. To create a customer type, choose Lists > Customer & Vendor Profile Lists > Customer Type List. When the customer type list window opens, press Ctrl+N to open the new customer type window, and then enter a name for the customer type.
Now you will be able to enter in a customer type when you are setting up each customer or if you are editing a customer record. The Customer type is listed under the Additional Info tab.
TIP: A common mistake is creating customer types that don’t relate to customer characteristics. For example, if you provide consulting services in several areas—like financial forecasting, investment advice, etcs—your customers might hire you to perform multiple services. So if you classify customers by the services you offer, you’ll wonder which customer type to choose when someone hires you for two different services. Instead, go with customer types that describe the customer in some way, like Homeowner, Contractor, General Contractor, and Commercial Construction.
You can even set up a customer type as a subtype of another type. For example, if you sell to different levels of government, the top-level customer type could be Government and contain subtypes Federal, State, County, and Local. To define a customer type as a subtype of another, turn on the “Subtype of” checkbox as shown here. Then, in the drop-down list, choose the top-level customer type.
Note: You can also create subtypes of Jobs and Vendors.
Jobs are optional in QuickBooks, so job types matter only if you track your work by job. Job types give you a way to classify your jobs so you can group and subtotal similar jobs on your reports. By using them, you’ll be able to determine which kinds of jobs are the most profitable for your business.
What should your job types be? It’s up to you to decide. Here are a few examples by Industry.
- In construction: Decks, Kitchens, Bathrooms
- In graphic arts: Logos, Brochures, PR
- In real estate: Brokerage, Property Management
How do customer types fit in? Customer types let you categorize your customers independently of the types of jobs you do. You can use customer types in addition to job types. You can also use job types without customer types, customer types without job types, or neither.
To Setup a Job Type: Creating a job type is similar to creating a customer type. Choose Lists > Customer & Vendor Profile Lists > Job Type List. When the job type list window opens, press Ctrl+N to open the new job type window, and then enter a name for the job type.
Now you will be able to enter in a Job type when you are setting up each new job or if you are editing a Job record. Job Type is listed under the Job Info tab.
You can also setup Vendor types to categorize the vendors in ways that are meaningful to your business. For example, you could set up your vendor types so that they indicate a vendor’s industry or geographic location. You can also place a vendor type as a subtype of another vendor type. For example, you might create the type Painters with the subtypes Exterior and Interior.
You can create reports and do special mailings that are based on your vendor types. For example, if you own a construction company and use subcontractors, you might want to use the ones closest to each job. You could then create a QuickBooks report that shows the subcontractors in each geographic area.
To set up Vendor Types: To create a vendor type, choose ListsàCustomer & Vendor Profile ListsàVendor Type List. When the vendor type list window opens, press Ctrl+N to open the new vendor type window, and then enter a name for the vendor type.
Now you will be able to enter in a vendor type when you are setting up each vendor or if you are editing a vendor record. Vendor type is listed under the Additional Info tab.
Using Types in a Report:
The Sales by Customer Detail report initially totals income by customer. To subtotal income by customer type (corporate, government, professional, and so on in this example) click Customize Report.
Note: To open the Sales By Customer Detail Report, select Reports Sales Sales by Customer Detail.