The accounting for the number of physical assets to be sold as well as quality control for sale is referred to as stocktaking. Another name for this process is stock counting. Because you have no way of knowing what inventory you have in stock unless you perform a stocktake, proper inventory management requires that you place this activity at the centre of your operations.
The process of physically obtaining verification of the quantities held and examining their condition is the definition of the term 'stocktaking', which is also known as stock counting or inventory checking. Other names for this activity include 'stock counting'. A stock take may be required of manufacturers for a number of reasons, including the provision of an audit of existing stock and the discovery of information regarding stock discrepancies.
The most effective method for conducting an inventory is to make use of high-quality software that is able to generate reports for the current day and offer information in real time. An inventory that is carried out at the close of an accounting period or on a predetermined schedule is referred to as a periodic stocktaking. If you have reason to suspect that theft is taking place, conducting spot checks is another good idea.
The taking of accurate stock removes the element of uncertainty from the process of planning for your business. It is possible for it to assist you in finding problems with your inventory and fixing them, which will allow your business to grow successfully. You might be putting yourself in a position to fail if you don't have a solid foundation. A significant number of businesses still use manual methods for inventory checking rather than turning to software.
Imagine that the data you have on your stock is so far out of sync with the reality of the situation that you are unable to fulfil orders in a timely manner without wasting enormous amounts of resources on overstocking. But, hey, things aren't all gloom and doom all the time. You should really be keeping your focus on the wonderful benefits that come with having a reliable stocktaking procedure in place. These are the things that you should really be keeping an eye on.
The link between your financial figures and what is actually happening behind the scenes is established through stocktaking. In the event that problems are found, this may result in the implementation of a number of different changes that will increase efficiency. The quality of your process for controlling inventory could be improved by addressing any discrepancies that are discovered during a stocktake. Cycle counting is a method for taking inventory that entails checking a predetermined portion of your stock on a regular basis on predetermined days. Cycle counting and more conventional stocktaking are two methods that are used by some smaller businesses. The size and nature of your company should determine how frequently you should take inventory of your supplies. Without the appropriate equipment and a method that has been carefully considered, navigating the stocktaking procedure can feel like navigating a minefield. When the results of a stocktake are compared to what you believe you have on hand, it is possible to detect inconsistencies and make corrections to them before they become a problem. Conducting a stocktake can help you find solutions to problems that your inventory management system may have overlooked. Products that are damaged, missing orders, poor control, or theft could be indicators of a more fundamental problem. The importance of stocktakes to your company, as well as the level of disruption caused by them, is directly proportional to the inventory system you use. When selecting a system for managing your inventory, one of the most important factors to take into account is how often you will perform stocktakes. If you are in the business of producing food, for instance, you might want to conduct stocktakes on a more regular basis. It will be a lot more of a hassle for a company that only does it infrequently to take stock than for one that does it regularly.
You may be able to identify a pattern of damaging behaviour on the part of customers or suppliers through the use of a stocktake, which will allow you to take steps toward correcting the issue. If they are isolated to a single instance, lost orders, damaged goods, and even theft are all part and parcel of doing business in any industry that involves the transfer of physical items.
If you have a clear understanding of the quantities of your stock and whether or not they match your plans and predictions, you can determine whether or not your company is succeeding in meeting its goals. For instance, if you want to make sure that all of the stock is moved quickly, you might want to change the prices. You also have the option of decreasing the amount of stockpile you maintain in case of unexpected events.
In the event that discrepancies are discovered during a stocktake, addressing those discrepancies could result in an improvement in the quality of your process for controlling inventory. The most obvious step that you need to take is to address the inconsistencies that have been found. However, you can extract even more value from the information that you have gained by conducting an in-depth analysis to determine the various ways in which your overall strategy for inventory management can be improved.
The process of cycle counting requires you to check in on a predetermined portion of your inventory on predetermined days at regular intervals. Because of this, you will not experience the disruption that is associated with a single annual take. Large corporations that are unable to halt their operations for an extended period of time in order to perform cycle counting are particularly fond of this method.
In some countries, it's even a legal requirement. However, even if it isn't required of you to do so by law, there are still several important reasons why you should check your goods on a regular basis.
The size and nature of your company should determine how frequently you should take inventory of your supplies. While some companies like to do a comprehensive inventory check once a year, others like to do it on a more frequent and frequent basis. An excessively frequent stocktaking routine can lead to confusion as a result of the many process interruptions that it causes.
If you find that you aren't keeping track of your goods as well as you believed you were, this could be an indication that your inventory control is lacking. Fixing problems as soon as possible is preferable to doing so later on because doing so prevents the escalation of issues such as overstocking and dead stock, which occur when products become out of date before they can be sold.
Without the appropriate equipment and a method that has been carefully considered, navigating the stocktaking procedure can feel like navigating a minefield. Conducting a stocktake can help you find solutions to problems that your inventory management system may have overlooked. Cloud software gives you the ability to easily track your product levels and location, but it is limited in what it can accomplish overall.
When it comes to keeping track of how well your company is doing, you don't want to leave anything to chance. In order to calculate important metrics like inventory turnover, you need figures that are accurate to the millisecond. After you have a better idea of how well your inventory control is working, you can begin to modify your processes and plans in order to achieve greater levels of productivity.
The importance of stocktakes to your company, as well as the level of disruption caused by them, will vary depending on the inventory system you use. A perpetual system like Unleashed ought to alleviate some of the burden that is associated with stocktaking. It doesn't matter what kind of company it is; it's still a significant undertaking that has to be done from time to time.
Your company will suffer losses if there is even the smallest variation in its stock. They are frequently indicators of a more significant issue with the control of your inventory. The investigation may require you to make adjustments to your procedures or add additional safeguards. After that, all that needs to be done to fix the issue is to upload the updated and accurate figure into your system.
When selecting a system for managing your inventory, one of the most important factors to take into account is how often you will perform stocktakes. If you are in the business of producing food, for instance, you might want to conduct stocktakes on a more regular basis. It will be a lot more of a hassle for a company that only does it infrequently to take stock than for one that does it regularly.
Ashly Chole - Senior Finance & Technology Editor