Yes, a spreadsheet runs a watch dealing business, and for a dealer under about fifty pieces selling through one channel it is the right tool. It needs roughly thirty columns - the twelve fields VAT Notice 718 requires in a margin scheme stock book, plus the ones you need to run the business - and it must never be re-sorted in a way that breaks the stock number sequence. It stops working on the day you have two sales channels, a second person, a watch out on memo, or an HMRC letter, and those days arrive in that order. Below is the template that works and the five failure modes that end it.
Spreadsheet or software: the honest comparison
| Spreadsheet (Excel or Google Sheets) | Generic retail (Shopify, Lightspeed) | Dedicated watch dealer software | |
|---|---|---|---|
| Cost | Effectively free | Shopify from £25/month; Lightspeed from £75/month | From free tiers to about £250/month; see the comparison |
| One record per watch | Yes, if you build it that way | No - SKU plus quantity | Yes |
| Margin scheme stock book | Yes, if you add the twelve columns and never break the sequence | No | Some; only the UK-built ones do it fully |
| Invoice wording and cross-reference | Manual, every time | Manual | Automatic on the UK systems |
| Chrono24 / eBay listing | Manual re-typing per channel | Shopify via crawl or app | Feed and API from the record |
| Listing pauses when piece leaves | No | No | Yes on the dedicated systems |
| Memo, consignment, repairs | Extra tabs, no controls | No | Built in on most |
| Edit history | None; any cell can be changed silently | Some | Locked documents and audit trail on the better ones |
| Two users at once | Google Sheets yes, Excel badly | Yes | Yes |
| Accountant export | Whatever you send | CSV or app | Xero / Sage / QuickBooks / CSV by vendor |
| Breaks at | ~50 pieces, 2 channels, 2 people | First memo or margin scheme invoice | Vendor limits |
What columns does a watch dealer's spreadsheet need?
One row per watch. One tab. Here is the list we would use, in order, with the stock book fields marked.
Identity
| Column | Why |
|---|---|
| Stock number (stock book) | Sequential, never reused, never re-sorted. The spine of the record |
| Brand, model, reference | Identification |
| Serial number | Identification; the stolen check runs on this |
| Year / production period | Pricing and description |
| Description (stock book) | Enough to identify the piece on an invoice |
| Box / papers / service history | Condition and value; drives price |
| Condition grade | Your own scale, used consistently |
| Photo folder reference | Where the images live |
Purchase - the stock book's first block
| Column | Why |
|---|---|
| Date of purchase (stock book) | |
| Purchase invoice number (stock book) | Yours, for a private purchase you write and the seller signs |
| Name and address of seller (stock book) | Also your AML record for a private seller |
| Purchase price (stock book) | The figure the margin is calculated from. Nothing else goes in this cell |
| How bought | Private, trade margin scheme, trade VAT invoice, part-exchange - this decides the VAT treatment |
| VAT treatment | Margin scheme / standard-rated / outside scope. Decided at intake, not at the VAT return |
| ID seen and recorded | Y/N and where; your money laundering record |
Cost to date
| Column | Why |
|---|---|
| Service and parts cost | Kept separate: Notice 718 says these must not be added to the purchase price |
| Other cost (authentication, postage in, insurance) | All-in cost for your own margin, not for VAT |
| All-in cost | Purchase price + service + other. Your real number |
Status and location
| Column | Why |
|---|---|
| Status | In stock / reserved / on memo / at workshop / consigned / sold / scrapped |
| Location or holder | Safe, window, which dealer has it on memo, which watchmaker has it |
| Date status changed | Aging starts here |
| Days in stock | Formula; your velocity measure |
| Listed on | Chrono24 / eBay / website / none - and the listing IDs |
| Asking price | Per channel if they differ |
Sale - the stock book's second block
| Column | Why |
|---|---|
| Date of sale (stock book) | |
| Sales invoice number (stock book) | Must carry the stock number as a cross-reference |
| Name and address of buyer (stock book) | |
| Selling price, or method of disposal (stock book) | Sales, but also scrapped, broken for parts, returned, stolen, taken into own use |
| Channel and channel fee | eBay, Chrono24, trade; the fee against the piece, not in a month-end lump |
| Margin (stock book) | Selling price minus purchase price. Not minus all-in cost |
| VAT due (stock book) | Margin x 1/6 for margin scheme pieces; separate column for standard-rated output VAT |
| Net after fees | Selling price minus all-in cost minus fees minus VAT due. What you actually made |
That is thirty-odd columns. The two that matter most are "VAT treatment" and "method of disposal", because the first is the decision HMRC will test and the second closes the loop on every piece that left without being sold. A stock book full of open rows on watches you no longer hold is the fastest way to turn a routine visit into a difficult one. The full requirements are in our stock book article.
Two tabs beside the main one: a consignment tab (consignor, agreed price, split, date in, date out, payout made) and a repairs tab for customer property (owner, item, date in, work agreed, price, date out) - customer watches must never appear in the stock list, because they are not your stock and your insurer will ask.
Rules that keep the spreadsheet honest
- Never sort in place. Filter, or sort a copy. The stock number sequence is a legal requirement, and a re-sorted sheet with a gap invites the question "what was in row 47".
- Never overwrite a purchase price. If you got it wrong, add a correction column with a date and a reason.
- Freeze the row when the watch is sold. Lock the cells or move it to a "sold" tab with the row intact.
- Export a dated PDF at every VAT quarter end. The PDF is the evidence that the numbers on the return came from a record that existed at the time.
- Back it up somewhere that is not the laptop the spreadsheet lives on. Six years' retention is the rule.
Do those five things and a spreadsheet will pass an inspection. It will not make the inspection pleasant.
The day it stops working
The failure is rarely the row count. It is one of these, and they arrive in roughly this order.
1. The second channel. The day you list the same watch on Chrono24 and eBay, the spreadsheet has no idea either listing exists. A watch sold on eBay at 9pm is still on Chrono24 at 9am, because Chrono24 pulls your feed once a day and you do not have a feed, you have a sheet. You will sell one watch twice within the first year; Chrono24's 14-day escrow and eBay's "not as described" process both make that expensive. How Chrono24 import actually works is the reason dedicated systems exist.
2. The second person. Excel on a shared drive is one editor at a time. Google Sheets handles two editors, but not two editors and a rule that nobody sorts. The first week with a second pair of hands is the week the sequence breaks.
3. The first memo. A watch goes out to another dealer on approval. The row says "on memo" - if someone remembered - and the listing is still live. The dealer sells it, you sell it, and the spreadsheet told nobody. Memo, consignment and workshop are all the same failure: stock that is not where the row says it is.
4. The margin scheme invoice. A margin scheme invoice must show no VAT separately, carry the stock number, and carry the statement "Margin Scheme - second-hand goods". A standard-rated invoice must show VAT. A part-exchange sale can need both, plus a purchase invoice for the piece coming in. Hand-writing three documents from a sheet is where the wording goes wrong, and the wording is what lets the next dealer use the scheme.
5. The letter. HMRC asks for the stock book and the invoices for the last two years. A spreadsheet whose cells can be changed without trace is weaker evidence than a system that shows what changed and when. The rule if HMRC cannot check your margins from your records is that VAT becomes due on the full selling price. That is the expensive failure mode, and it is the only one that does not announce itself in advance.
What should you move to, and when?
Move when one of the five above has happened once. Not before; the spreadsheet is genuinely fine until then, and moving early buys you a monthly bill and a migration for no gain.
When you do move, the thing you are buying is the three things a sheet cannot do: one record per watch that feeds every channel and pauses everywhere when the piece leaves; a VAT treatment decided at intake that flows to a correctly worded invoice and a sequenced stock book; and an edit history. The options in August 2026 are walked through in best watch inventory software for dealers: Elefta and Uploadify from the US in dollars, WatchTraderHub from Bulgaria in euros with margin scheme invoicing, WatchFlow and ChronoDesk, or Shopify and Lightspeed as generic tills.
Milleso is our product, so weigh this paragraph accordingly: it is built around exactly the columns above - serialised stock with all-in cost, VAT treatment set at intake, stock book and invoice wording automatic, Chrono24, eBay, Shopify and WooCommerce fed from the record and paused when a piece goes on memo or into the workshop, consignment payouts and customer property tracked separately, Xero and Sage export. Counter is £99 a month and Trade £249 a month ex VAT, with one month free and the spreadsheet migration done for you. It does not do US tax, multi-store, or a pawn-loan ledger, and the only card terminal is the Dojo integration. The full comparison lists it alongside the others with the same disclosure.
What we could not verify
- Whether a spreadsheet stock book has ever been rejected by HMRC purely for format. Notice 718 does not require a physical book or set a format; what it requires is that the records allow the margins to be checked. We found no published case turning on the format alone.
- Row counts at which Excel or Google Sheets become impractical. The "about fifty pieces" figure is our observation of where dealers tell us the sheet broke, not a measured limit.
Sources
- The Margin and Global Accounting Scheme (VAT Notice 718) - GOV.UK, paragraphs 5.2 and 5.3 for the stock book and invoice cross-reference
- Record keeping (VAT Notice 700/21) - GOV.UK, six-year retention
- Chrono24 - Listing Import Guide - once-a-day pull, XML or JSON
- Shopify - UK pricing
- Lightspeed Retail - UK pricing
This is general information, not tax advice, and it is not a recommendation to buy any product. The stock book requirements are HMRC's and the consequences of a bad one fall on you; confirm your record-keeping with your accountant and read Notice 718 directly. Milleso is our product and this page says so where it appears.