Inventory Management Software: 7 Ways to Move Margin

Written by: JJ Tan, Founder, Jelly | Last updated: 24 September 2026

Key Takeaways

• Inventory management software protects gross margin by tracking real-time COGS, landed costs, and supplier price changes so operators can act the same day.
• Seven specific capabilities move margin: real-time COGS tracking, landed cost inclusion, price-change alerts, GMROII analysis, markdown timing, EPOS-linked sales mix, and accounting integration.
• UK hospitality faces unique margin pressures such as recipe-level costing, VAT-inclusive invoices, and EPOS integrations that generic retail platforms rarely handle well.
• Operators using Jelly cut food costs by 3% on average in the first three months and add 2 percentage points to gross margins. One site improved gross profit from 65% to 72% within 12 weeks.
• Jelly provides automated invoice scanning, real-time dish costing, Price Alert, Flash Report, and native EPOS integration with Square, EPOS Now, Toast, and Lightspeed.

See Jelly Working With Your Own Invoices

7 Capabilities That Convert To Margin Points

1. Real-Time COGS Tracking. Dish costs need to update as invoices land, not at month-end. Jelly automatically scans every line item of every invoice, including quantity, SKU, price, and tax. It then updates recipe costs the moment new prices arrive. A dish that was profitable on Monday appears in red by Tuesday if a key ingredient price rises.
2. Landed Cost Inclusion. Freight, duties, and handling belong in the cost or reported margin looks higher than reality. Tracking only the supplier purchase price produces incorrect margins. A product costing $2.00 at the supplier’s dock can carry a true landed cost of $3.40 once freight, customs duties, port handling, and inland trucking are added. Every unit priced off the headline figure then carries thinner margin than expected.
3. Price-Change Alerts. This capability turns a supplier increase into a negotiation, a substitution, or a credit note. Jelly’s Price Alert feature flags every single price increase or decrease and gives operators concrete evidence for supplier conversations. Teams can call a supplier, challenge the rate, and recover margin before the change compounds. Amber restaurant in East London saves £3,000–£4,000 per month through credits, better buying, tighter menu controls, and faster reactions to price swings.
4. GMROII. GMROII measures the gross margin earned for each pound of average inventory held over a defined period. A GMROII of 2.0 means £1 of average inventory at cost generates £2 of gross margin. A GMROII below 1.0 is a review signal. It prompts a check on availability, demand trends, and business priorities before any decision to cut a product.
5. Markdown And Menu Timing. Early flags on low-margin dishes give operators time to act before the menu cycle ends. McKinsey data shows that slow-moving inventory can be reduced by approximately one-third within three months, improving stock turnover and reducing excess holding costs. In hospitality, that improvement means removing or repricing a dish before it drags down the week’s GP.
6. EPOS-Linked Sales Mix. Connecting what sells to what it costs to make is the hospitality-specific capability that retail-led platforms often miss. Jelly integrates natively with Square, EPOS Now, Toast, and Lightspeed via real-time API. It delivers item-level sales data the moment a transaction completes. Sushi Revolution uses Jelly to set separate target gross profits on dine-in and delivery menus, achieving actual gross profits 2–3% higher on average.
7. Accounting Integration. Digitised invoices pushed to Xero in one click, with Sage coming soon, cut bookkeeping time by up to 90%. Jelly users report saving 10–20 hours of admin every month. That time returns to menu decisions, supplier conversations, and team coaching instead of data entry.

Why UK Hospitality Needs Margin-First Inventory Tools

UK hospitality runs on a margin stack that retail-led inventory platforms rarely handle well. Recipe-level costing, EPOS-linked sales mix, VAT-inclusive supplier invoices, and Xero or Sage integration form the four layers that matter most. No generic retail competitor covers all of them in a way that fits a busy kitchen.

A retail SKU has one cost. A dish has dozens of SKUs from multiple suppliers, and those prices fluctuate weekly. Batch recipes and wastage percentages add another layer of complexity. VAT-inclusive invoices mean the headline price on a delivery note differs from the net cost. UK hospitality operators must apply VAT correctly across standard, reduced, and zero rates, break VAT down clearly on receipts, and export clean digital records that feed into accounting platforms such as Xero, Sage, or QuickBooks. Generic retail inventory tools were never designed around that requirement.

The compliance backdrop increases the pressure. Making Tax Digital for VAT has required VAT-registered UK businesses to keep digital records and file VAT returns through compatible software since 2019, and from April 2026 MTD extends further to sole traders with gross income above £50,000. UK hospitality operators are increasingly looking beyond compliance to platforms built specifically for hospitality rather than adapted from generic retail systems. Jelly is built for that gap.

Choosing Inventory Software That Protects Margin

The platforms below are grouped by what they actually do for margin. Read the capabilities as a guide to where each tool starts: supplier invoice, stock count, or demand plan. Square, EPOS Now, Lightspeed, and Toast are not included here because they act as POS integration partners that Jelly works alongside, not as alternatives to it.

The retail-led platforms in this table perform well in their own domains. Most of them focus on stock levels or demand plans rather than the supplier invoice. Hospitality margin usually leaks at the invoice line where a price changed on Tuesday and nobody noticed until the accountant filed the month-end report.

Jelly’s operator outcomes show what invoice-first control delivers. Users cut food costs by 3% on average in the first three months and add 2 percentage points to gross margins. One operator improved gross profit from 65% to 72% within 12 weeks on approximately £500,000 in revenue. Populu lifted GP from 68% to 72% across 16 locations. Flat-rate pricing at £129/month per location keeps costs predictable as you scale.

Compare Jelly To Your Current Margin Process

What Software Cannot Fix On Its Own

Software cannot make a chef maintain recipes accurately, negotiate with a supplier, or remove a loss-making dish from the menu. It can give you the evidence, including the price change, the margin percentage, and the dish-level COGS. The decision still sits with the operator and the team.

Most inventory problems are process problems. The root cause of many inventory errors is a process gap. Data discipline, supplier negotiation, and menu discipline are human choices. A platform like Jelly removes the excuse of not knowing. Price changes appear the same week they happen, dish margins stay live, and the evidence for a supplier conversation already sits in the system.

When Free Tools And Excel Stop Working

Excel works for a single site with a handful of SKUs and one person maintaining it. A well-built spreadsheet tracker can work for a very small, single-user operation, but breaks down once you need real-time updates, multiple editors, low-stock alerts, or any connection to sales channels.

Spreadsheets fail when multiple people need the same data simultaneously. They fail when supplier prices change weekly and the sheet is updated monthly. They also fail when you need real-time dish costing instead of a monthly reconciliation. The upgrade trigger from spreadsheets is the moment multiple people need the same data. For a growing UK hospitality operator approaching a second or third site, that moment arrives quickly. On average, costing a single menu item in a spreadsheet takes 28 minutes. In Jelly, it takes 3 minutes.

How To Evaluate And Implement Inventory Software

Ask vendors to demonstrate a live invoice-to-recipe reconciliation using your own product codes. If they cannot do it in the demo, it will not work smoothly in production. Finance teams should ask whether invoice automation reconciles to purchase order and contract price, or merely to the invoice total, and whether recipe costing updates automatically when a supplier invoice price changes.

Check POS setup effort as well. Connecting any of Jelly’s supported POS systems, including Square, EPOS Now, Lightspeed, and Toast, takes under five minutes and follows the same flow across all four. Open Jelly, click Integrations, sign in to the POS, grant permissions, and select which categories to sync. Ask how long until the first price alert lands. Jelly onboards and generates initial value in the first week.

Frequently Asked Questions

What Is the Best Software for Inventory Optimisation in UK Hospitality?

Jelly fits growing multi-site UK restaurants, pubs, and boutique hotels doing over £500k turnover because it starts from the supplier invoice rather than the stock count. It captures every line item automatically, updates dish-level COGS in real time as new invoices arrive, and flags every supplier price change fast enough to act on. Retail-led platforms such as Unleashed and Cin7 perform well within their verticals but are not designed around recipe-level costing, VAT-inclusive supplier invoices, or the EPOS integrations that UK hospitality operators rely on. NetSuite’s UK restaurant ERP offering does track ingredients through recipe BOMs, automate VAT and Making Tax Digital submissions, and integrate with EPOS (Lightspeed natively, other UK providers via middleware), although some capabilities rely on partner integrations.

How Does Inventory Software Improve Gross Margin?

Inventory software improves gross margin by lowering COGS and making reported COGS more accurate. Real-time COGS tracking keeps dish costs aligned with current ingredient prices instead of last month’s figures. Landed cost inclusion captures freight and handling inside the cost rather than in a general expense account. Price-change alerts surface supplier increases fast enough to negotiate, substitute, or claim a credit note. Markdown and menu timing highlight low-margin dishes before the menu cycle ends. In hospitality, where margins stay tight and ingredient costs fluctuate weekly, acting quickly on these signals compounds into meaningful percentage gains.

Can I Use Excel for Inventory Management?

Excel can handle inventory for a single site with a small number of SKUs and one person maintaining the data. Once supplier prices change weekly, multiple team members need access to the same figures, and you need real-time dish costing instead of a monthly reconciliation, Excel turns into a data-entry exercise. The specific failure point for growing hospitality operators is the combination of fluctuating ingredient prices, batch recipes, and multi-site visibility. A spreadsheet rarely handles that mix reliably once the operation scales beyond one location.

What Is GMROII and Why Does It Matter for Hospitality?

GMROII stands for Gross Margin Return on Inventory Investment. It measures the gross margin earned for each pound of average inventory held at cost over a defined period. A GMROII of 2.0 means every £1 of average inventory generates £2 of gross margin. For hospitality operators, the metric works best as a comparison tool across dishes, categories, or suppliers. A high-margin dish that sits unsold for days can have a lower GMROII than a thinner-margin dish that turns over quickly. A GMROII below 1.0 signals the need for review, taking availability and demand trends into account before any decision.

How Quickly Can I Expect Results from Inventory Management Software?

With Jelly, initial value arrives in the first week. Once suppliers send invoices to a dedicated email address, or within 24 hours of photographing invoices into the platform, price alerts and spending insights go live. POS integration across Square, EPOS Now, Lightspeed, and Toast takes under five minutes to connect. As the earlier figures showed, Jelly users typically cut food costs by around 3% in the first three months and add roughly 2 percentage points to gross margins.

Conclusion: The Invoice Is Where Margin Leaks

Gross margin optimisation in UK hospitality starts with invoice data. Margin loss happens when a supplier price rises on a Tuesday and the operator does not find out until the accountant files the month-end report. By that point, dozens of covers have been served at the wrong margin and the window to negotiate, substitute, or reprice has closed.

Jelly is a London-based invoice-processing and margin-tracking platform built for UK hospitality, including independent restaurants, pubs, cafés, and multi-site groups. It automates invoice processing and combines supplier costs with sales data to deliver real-time margin insights. Automated invoice scanning, real-time dish costing, Price Alert, and Flash Report combine into a system that surfaces margin problems fast enough to act on them. Native EPOS integration with Square, EPOS Now, Toast, and Lightspeed keeps that system fed with live sales data. One-click Xero integration and Sage coming soon mean the accounting stack is covered too. Flat-rate pricing at £129/month per location, with no variable charges per user or feature, keeps the cost predictable as you grow.

See Your Own Invoice-To-Margin Gap