@VTXtools 

You are doing it properly.  The products are not inventory for you, they are inventory for your vendor.  Two businesses cannot claim inventory on the same product.  The bottom line is that if you do not have title to the products, they are not inventory.  You can still book the cost of them to a separate expense account and see your margin(s).  Just record the cost of the products to a dedicated expense account when billed from your vendor.  You will not have the QB inventory reporting features because they are non-inventory items, but it is the proper way to record it.