5 Tips for Taking a Physical Inventory
The following 5 tips will help make this routine easier, more manageable, and consistent every year.
1. Make a Plan
A written plan is a great way to hold yourself and your employees accountable. Prior to counting, fully stock the store shelves and order the supplies you’ll need for counting. Set a firm date with a deadline, so you understand when the counting begins and ends. This plan should describe the expectations for everyone, including yourself, which will be immensely important if you have multiple stores and warehouses.
2. Train Your Employees
It’s easy to take it for granted that everyone counts the same as you do, so teaching them your process will guide them through a seemingly mundane task. There are two ways to count inventory: manual (either handwritten or entered into a tablet) or with a barcode scanner. Smartwerks physical inventory software allows you to do both.
Properly trained employees perform their duties according to your expectations. Show them how you want them to count and how they should record the numbers. Also, remember to train your employees in spotting unpriced or broken merchandise.
3. Map Your Store
A sketch of your store will enhance your plan. You don’t have to be an artist. Simply use basic shapes, such as squares and triangles, to represent racks, bins, and shelves. Start from the front of your store, then work your way counter-clockwise around it. You should also do the same for your warehouse, making sure you include every drawer, rack, and pallet.
4. Clean out the Clutter
Getting the warehouse or backroom storage area prepared for counting will ensure that all of the merchandise is in its proper place. Empty boxes, trash, and other materials will slow your counting. Cleaning will also give you a preview of the shelves and locations that may need to be fixed or labeled better.
5. Cycle Counts
There is only one way you can be excused from this annual ritual. It’s through a process called cycle counts. This is a form of counting your physical inventory, but it is staggered throughout the year and only focuses on a single product category. One of the advantages of cycle counts is that frequency prevents errors, because you identify problems quicker.
Another advantage of performing cycle counts is the need for fewer people to perform the counts. It can also be done without any interruptions to your business. If the holiday season makes it nearly impossible to do a proper count, then cycle counting might be a viable option.
Make It Fun!
When you perform a physical count of your inventory, you can find discrepancies between what’s on the shelves and what’s in the computer. Most automated point of sale systems, such as Smartwerks, have analytics built-in to give inventory shrinkage reports that provide dollar amounts and percentages showing these discrepancies.
Regardless of how you count your physical inventory, the above tips will help you save valuable time and resources. Accounting for your physical inventory doesn’t have to feel tedious, and providing the right environment with food and music can make it fun.