Doing a regular stock take is essential to ensuring you have an accurate count of all the items in your warehouse. To conduct a successful stock take you must first make sure you understand the benefits and function of a stock take. This can affect how you carry out the stock take and highlight areas you might need to focus on while doing it.
Some of the considerations to keep in mind before doing a stock take include:
Asset Tracking and Valuation – Most businesses have a large part of their capital tied up in assets. These assets include buildings, automobiles, machinery, furniture, etc. While the stock take is ostensibly about counting the stock currently being held, it is also a good time to count your longer-term assets. This will ensure more accurate accounting on your balance sheet.
Managing Stock Levels – more accurate stock management can prevent overordering and free up space for other products. This means you can save money while still delivering products on time.
Anticipating Demand – demand for certain products will often change based on seasonality, holidays, days of the week, etc. having an accurate view of your stock can highlight which items are most affected by these factors and enable better predictions of upcoming fluctuations.
Shrinkage, Theft, and Loss Control – if you are not keeping proper track of your stock it makes it vulnerable to carelessness, lost stock, and theft. If there is a proper accounting for all stock there is also accountability for all stock. This results in employees taking more responsibility for items under their care.
Accounting and Insurance – To keep accurate accounting records you need to be able to put a value on your current inventory, and in the event of a disaster you need to be able to account for all of your inventory. By keeping an accurate stock count, you can keep accurate account records and eliminate unnecessary worry about insurance claims in the event of a disaster.
Location Decisions – it is helpful to know where the most frequently accessed items are located. Item location should be set up to provide easy access to the most frequently used items, not as an afterthought or according to habit. Regular stocktake will highlight which items are in heist demand and inform where they should be located.
Once you have figured out what information you need form the stock take you can plan out how to conduct a stock take. See our next blog post to find out more. Warehouse 101 – Inventory Basics – How To Conduct a Stock Take