Commentary | Viewpoint

How to Make Physical Inventory Counts Less Stressful

Tags: Inventory Management, Warehousing

Brandon Levey is the CEO of StitchLabs, 317-806-1900.

Small business owners may struggle finding time to interact with customers, let alone counting inventory and checking for inaccuracies in the warehouse. Although technology tools can help manage inventory, you must implement systems in-house that account for physical stock counting. Many product-based businesses will ditch the annual inventory count and opt for something a little less taxing – ongoing cycle counts.

Cycle counting is an inventory auditing process that occurs continuously throughout the year, allowing you to only focusing on a subset of inventory. Cycle counts are less disruptive to daily operations, provide an ongoing measure of inventory accuracy and procedure execution, and can be tailored to focus on items that have higher value, higher movement volume, or are critical to business processes.

The Benefits of Cycle Counting

Limited disruption. Keep cycle counts as a part of your weekly routine to prevent major disruptions in the warehouse. When businesses conduct full-day annual inventory counts, the entire warehouse must often be paused to finish the job. With cycle counting, inventory accuracy is evaluated on an ongoing basis, allowing for minimal disruption and continuous communication among your team.

Instituting basic processes to optimize your warehouse will also make your cycle counts easier. For example, breaking down boxes as soon as product arrives will cut down on clutter and keep traffic ways clear. The extra effort immediately will save you tons of time later during cycle counts.

Increase confidence in buying decisions. When you implement ongoing cycle counts, you’re forced to continuously assess your inventory. By having smaller check-ins, focusing on a subset of inventory, your buying decisions are more informed and targeted. You’re able to avoid stockouts ahead of time and create a better report for buyers on your team.

Lessen discrepancies. By shortening time between counts, you decrease the amount of time in which errors could have been made. If you account for inventory incorrectly, waiting several months may cause a large issue with your customers and your business as a whole. Smaller, ongoing counts will catch mistakes faster. And don’t forget to stock most commonly ordered items together. When going through your cycle counts, ensuring items are easy to find will make inventory a breeze.

Maintain focus and keep inventory as a priority. Inventory can often be the most frustrating part of owning a product-based business. Implementing smaller cycle counts helps the entire operations team to see stock accuracy as a vital part of the business, allowing them to feel more confident about the business decisions you make. It also decreases the amount of stress inventory counts can cause.

Annual inventory counts are time-consuming and drain resources. While annual inventory counts feel like a great way to end the year and begin with a clean slate, they drain time and human resources. Maximize productivity and encourage ongoing communication about inventory by implementing cycle counts. Check with your team after the first year of using cycle counts. Their speed and dedication on executing various warehouse processes can make or break the bottom line. Asking for input to improve operations is key. Keep an open, healthy line of communication going, and never undervalue employee feedback. This is their livelihood too – learn to trust their instincts.






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