How to Keep Track of Inventory for Free (3 Methods Compared)

Keeping track of inventory for free means choosing between three proven methods: spreadsheets, pen and paper, or free inventory management software.

Spreadsheets work well for growing manufacturers with fewer than 50–75 items, but dedicated software handles reorder points, low-stock alerts, and reporting far better as you scale.

Here's how each method works — and how to pick the right one.

With poor inventory tracking, you might end up producing more or less than you need. Inventory is an asset — having too much ties up cash, and having too little leads to lost sales and frustrated customers.

The good news is you don't need to spend thousands to get started. Below, we'll walk through each free method so you can decide which one fits your business.

What are the different methods of tracking inventory for free?

How to keep track of inventory using Excel or Google Sheets

Spreadsheets like Excel or Google Sheets are a popular free way for businesses to keep track of their inventory levels — if their needs are straightforward. What counts as straightforward? When you don't manage too many finished goods and raw materials. Under 50–75 items is a good rule of thumb. Anything more, and it involves too much manual work to stay accurate.

A basic inventory spreadsheet typically includes columns for item name, SKU number, quantity on hand, reorder point, unit cost, and supplier. You update it manually every time stock comes in or goes out.

If you're looking for a free inventory management spreadsheet template, Google Sheets is usually the better choice over Excel because it saves to the cloud automatically and lets multiple people view the same file.

Read more: Why manufacturers outgrow spreadsheets

Pros

• Can be set up quickly — a good way to get started
• No equipment necessary besides a computer
• Can be fairly customized with formulas
• Easy to understand

Cons

Very time-consuming to maintain as your product list grows

Grows in complexity as your business grows

You still have to gather information manually and enter it into the spreadsheet

Difficult to share with team members unless you're saving to the cloud

• Very basic — doesn't offer much beyond tracking quantities
• No way to set automatic alerts for low inventory levels
• Error-prone — a single typo can throw off your counts
• Can't link barcodes or images to items

How to keep track of inventory with pen and paper

Another way to track inventory is through pen and paper. This can be something as simple as a whiteboard, a notebook, or a printed count sheet. This method works best for businesses with a very small number of SKUs and simple inventory needs.

The downside is that it's extremely time-consuming to maintain, and it's easy to make mistakes when you're updating numbers by hand throughout the day.

Pros

• Quickest to set up and get going
• Does not require any special equipment or software
• Any non-tech-savvy person can use it

Cons

Less accurate than other methods

Extremely difficult to share with other members of your team

• Very time-consuming to maintain
• Must be updated constantly to stay useful
• Impossible to get reports, forecasts, or interpret data
• No way to back up data if paper is lost or damaged

How to track inventory for free using software

Free inventory management software is a step up from spreadsheets and pen-and-paper methods. Several tools offer a free tier or free trial that includes basic inventory tracking features — things like item catalogs, stock-level monitoring, and simple reporting.

Some popular options include Zoho Inventory (free tier for low-volume businesses), Sortly, and other cloud-based platforms. These free tiers usually come with limits on the number of SKUs, users, or orders per month. Once you outgrow those limits, you'll move to a paid plan.

For growing manufacturers who also need production planning, bill of materials management, or lot traceability, a free general-purpose inventory tool often falls short. That's when purpose-built manufacturing software becomes worth the investment.

Pros

• Quick and easy to use compared to manual methods
• Traceability features for businesses that need them
• Offers features beyond basic inventory tracking (reports, alerts, integrations)
• Can track a large variety of inventory items
• Data is securely stored in the cloud
• Collaborative — great for teams working across locations

Cons

Free tiers have limits on SKUs, users, or transactions

May require time to set up and learn

Advanced features (like barcode scanning or multi-location tracking) are often locked behind paid plans

How to decide which inventory tracking method is right for you

The right method depends on a few factors: the size of your business, the complexity of your inventory, your team size, and your budget.

Choose spreadsheets if you have fewer than 50 items, one person managing inventory, and simple in-and-out tracking needs.

Choose pen and paper if you're just getting started with a handful of products and need to track stock today with zero setup.

Choose free software if you're tracking more than 50 items, need multiple people to access inventory data, or want features like low-stock alerts, reporting, and barcode scanning.

No matter which method you choose, the important thing is that you track your stock regularly. Consistent tracking helps you avoid stockouts, reduce waste, and make better purchasing decisions.

If you're a growing manufacturer, keep in mind that raw material tracking and inventory turnover become harder to manage with free tools as you scale. Planning for that transition early saves a lot of headaches later.

Tips for better inventory tracking on a budget

Whichever method you pick, these practices will help you get more accurate results:

Do regular cycle counts. Don't wait for an annual count. Pick a handful of items each week and verify the numbers match your records. This is one of the most effective ways to improve inventory control.

Set reorder points. Even in a spreadsheet, you can add a column that flags when stock drops below a certain level. This keeps you from running out of your best sellers.

Use consistent SKU naming. Create a clear naming system so every item is easy to find and count. Here's a guide on how to create SKU numbers that actually work.

Assign one person to own inventory. When everyone updates the count, nobody owns the count. Designate one team member to be responsible.

Back up your data. If you're using spreadsheets, save to Google Drive or another cloud service. Paper records should be photographed or transcribed weekly.

Frequently asked questions

Is Zoho Inventory really free?

Zoho Inventory does offer a free plan, but it comes with strict limits — typically capped at a low number of orders per month, limited SKUs, and a single user. It works for very low-volume businesses, but most growing companies hit those limits quickly and need to upgrade to a paid tier.

What is the best free inventory management software for a small business?

It depends on your needs. Zoho Inventory and Sortly both offer free tiers with basic tracking. For manufacturers who need production planning, BOMs, and lot tracking, free tools are usually too limited — purpose-built manufacturing software is a better fit, even at a modest monthly cost.

Can I use a barcode inventory system for free?

Some free inventory apps support basic barcode scanning using your phone's camera. However, most full-featured barcode inventory systems — with label printing, scanner hardware support, and real-time updates — require a paid plan.

How do I create a free inventory management spreadsheet?

Open a new Google Sheet and create columns for item name, SKU, description, quantity on hand, reorder point, unit cost, and supplier. Update it every time stock moves in or out. Google Sheets is free and cloud-based, which makes sharing with your team easier than Excel.

When it’s time to move beyond free tools

Spreadsheets and free inventory apps work when you have a handful of SKUs and one storage location. The cracks show when you add a second warehouse, start tracking raw materials separately from finished goods, or need to know not just what you have, but what you need to order based on upcoming production.

Brahmin Solutions picks up where free tools leave off. Every inventory transaction — receiving, production consumption, shipments, adjustments — updates stock levels instantly across all locations. Reorder points trigger automatically based on your actual usage and supplier lead times, so you find out you’re running low before you run out.

If you’re feeling the limits of your current tracking method, book a demo and see what the next step looks like.