4 Benefits of Cycle Counting

If your inventory is growing as your business grows, you know that one of those growing pains is the dreaded inventory day. When you've got more things to count, so how do you keep the most accurate counts without having to close down the shop for a full inventory day? The solution might be cycle counting, a rolling system that might make your marathon inventory days obsolete. Cycle counting is a process where you count category by category vs. doing one big full-inventory count. Large retailers do this, well, quite literally all the time. That's the thing with cycle counts—it's an always-running process. Even though it's constant, it's also broken down into smaller bites of inventory that are much more digestible for many business owners than the whole shebang.

If you're interested in switching to cycle counts, start by identifying places in the week where you and your employees  might have time for inventory counts. Maybe it's on a slow morning and right after you close up on Tuesdays—whatever works for you. Then create your inventory cycle. Depending on your stock, your  full cycle might be only a couple of weeks long or it could be as long as thirteen weeks.  Spread your categories evenly over your cycle—each category should be counted at least once in that cycle. When you get to the end, just start the cycle again!


What are the benefits to cycle counting?

1. It allows you to focus and confidently make ordering decisions. Counting more frequently will  open the door to a more accurate ordering system. You can focus on just one area of your shop, so use that dedicated time to not only count up, but make decisions about that subset of your business. 

2. It helps avoid discrepancies. Your counts will be more frequent, so it'll help you better identify  loss patterns and even have a more precise idea of when a theft occurred.

3. It gives you an excuse to clean up. When you're rifling through products more often, it provides a perfect opportunity to dust things off and keep your displays sharp.

4. It stops you from draining resources. Cycle counts can be done during down-time and don't necessitate closing or disrupting regular business. You know that one morning every week where you never see a living soul in the shop between 1 p.m. and 3 p.m.? Rather than spending an extra two hours  on Facebook, count up everything in your dry goods section and check that off the inventory list for the week.

How have you set up your cycle counting system? Let us know in the comments!