Performing a complete stock take at least once year can be tedious, however it is critical for maintaining healthy inventory levels and minimising losses in a business. Stock take is important because it reveals discrepancies between inventory stock records and the number of stock you actually have. Uncovering the issues that attribute to stock loss or incorrect counts can help move your business in a more profitable direction. We will look into the most common stock take mistakes and what you can do to resolve them.
What causes stock take mistakes?
There are many reasons as to why business owners will see stock take discrepancies. Here we have highlighted the most likely causes, and note, causes can vary greatly depending on industry and inventory record keeping methods. Discrepancies can occur due to damaged stock, stock that is in the incorrect location, human error during the stock take process, theft, wrong labelling, stock that has been mistaken for a similar product, inbound and outbound stock not being recorded accurately, faulty inventory management to even the incorrect unit of measurement used.
Checklist for stock take discrepancies
Recounting stock in question, should be your first point of action if things are not matching up. It could simply be a mistake during the original counting process. Check if the location of the stock is incorrect. It could possibly be that it has not arrived from your supplier in the first instances. Take note of the unit of measurement used. Spot check that the SKU or product identification number is correct. Ensure the product has not been mistaken for a similar product. Double check your inventory records, perhaps the discrepancy may be as simple as a mathematical error. Ensure there is no missing paperwork, for example, sales or orders that have not been accounted for can often unbalance your stock take count. Investigate whether employees or customers have been stealing stock, which means you might need to consider CCTV, security tags on stock or random security checks.
Creating a clear plan for stock take
It is increasingly important that a clear plan of attack for counting stock is put in process to avoid the stock take mistakes aforementioned. By developing a well-structured process that employees and managers can follow together, you can all avoid the many pitfalls. These include organising your stock room before a stock take is pursued, ensuring your staff are well trained to look out for the correct unit of measurements, taking into account attention to detail when looking at product descriptions or SKUs.
Use current inventory data
The goal of a stock take count is to check whether your count matches your data on hand. It is then vital to exclude items that have already been invoiced to customers but have not yet shipped, as well as inventory that may have arrived but have not yet been entered into your inventory system.
Use a perpetual inventory management system to keep an updated record of your stock movements as it happens.
You haven’t automated your process
Finally, if you are not already logging your inventory into an automated system then you are certainly losing a lot of time. Human error cannot be helped, no matter how meticulously you are entering data. Find an automated system,
use barcode scanners or download inventory software that works for your business and you can monitor orders, track items, and take stock with everything stored in one central location.
