How to Count Your Stock: A Guide to Inventory and Year-End Counts

The stockroom is the heart of a business. The better it is managed, the more smoothly the business runs and the more quickly it can respond to what customers want — and it cuts out unnecessary costs, which means better profits.

Here is a look, for business owners, at the stock-counting strategies that will help you count what is left efficiently and to your business's benefit. Read on.

Why counting your stock is worth doing

A stock count means checking and counting the goods held in your stockroom. The main aim is to confirm that the quantities actually on the shelves match the figures in the system, so you can be confident your data is accurate and up to date. The benefits to the business are these.

• You know exactly what stock you have : you get a clear picture of what is really in the stockroom, which means you can plan reorders far more effectively.
• You can check your product data is correct : comparing the figures in the system with what is physically there helps you find goods that have gone missing or been damaged, and guards against theft.
• You can plan stock management properly : it makes items quicker to find, helps you dispatch on time and reduces mistakes in the day-to-day work.
• You can separate out damaged and near-expiry goods : it helps with planning how stock is stored and with handling items approaching their date.
• You run more efficiently : it lets the business manage inventory effectively, and makes the shop more dependable in its customers' eyes.

The types of stock count

Counting stock is a key part of running a stockroom in retail, and there are two main ways of doing it.

1. Counting all your stock in one go (physical count)

This means counting everything in the stockroom in a single exercise. It is generally used by organisations or shops that want to assess where their stock stands, need to produce an annual count report, or are following a set policy.

The steps in the count

1. Plan : set the date and time of the count, and get the paperwork and equipment you need ready — stock lists, pens, pencils, a calculator. Decide when you will close, and when goods will come in and go out of the stockroom.
2. Count : divide the goods into groups and start counting each group, recording the quantities as you go.
3. Conclude : compare the counted quantities against the figures in the system, produce the report and analyse the results.

Strengths and limitations

A physical count is the most accurate method and only has to be done once a year, but it costs you in time, people and money. It suits businesses that need exact stock figures and can stop goods coming in and going out while it happens.

2. Counting stock in rotation (cycle count)

This is a continuous approach: the goods are split into groups and each group is counted on its own schedule. You might, for instance, split the count into three groups, A, B and C, and handle each like this.

• Group A : counted every month
• Group B : counted every quarter
• Group C : counted every year

Counting stock this way lets a business verify its inventory figures accurately.

The steps in the count

1. Group your stock : divide it by importance, value and risk
2. Plan : set the date and time, and let staff know
3. Count : count each group when its turn comes round, and record the quantities
4. Conclude : compare the counted quantities against the figures in the system, produce the report and analyse the results

Strengths and limitations

A cycle count suits businesses that want to check their stock regularly without having to stop goods coming in and going out, but it takes longer overall than a physical count and can add to the workload on staff.

Use POS software to make counting and checking stock easier

If you would rather not put yourself through a difficult stock count, consider switching to POS software with stock-checking built in, along with a broad set of other features: real-time inventory figures, help with checking stock, identifying your best and slowest sellers and items nearing expiry, plus analysis of sales data and customer behaviour — all of which leaves an owner more time to plan marketing and sales strategy effectively.

Choose an effective stock-counting programme from Qashier, with our retail shop POS for retail businesses. It will help you run the business quickly and conveniently, keep it growing steadily, and handle everything that needs handling without fuss. For more information, reach us on LINE Official: @qashier.th or call 02-544-0267

References:

1. How many ways are there to count stock? Choosing the right one for an accurate, efficient count. Retrieved 23 February 2024
2. Inventory Count Best Practices. Retrieved 23 February 2024