Inventory doesn't have to be miserable.
We at Shopventory work with thousands of merchants all over the world. So, we know the words "year-end inventory" often strike terror into the hearts of most retailers. However, there's no better time than a end-of-the-year inventory count to get your business organized and be certain you're starting the new year right.
Here are your seven steps to year-end inventory Nirvana:
1. Assess your current status.
'Before and After' pictures are a good way to know if your diet plan works. Before you re-model your inventory, it's good to know what you “believe” you have in stock and what it is worth (cost and retail value).
Your inventory management solution must have a reliable way to get this information in a report. Shopventory users can simply pull an inventory report for any time in history. (So you can still get the history, even if you've already made the changes!) You will want to compare what you believe you have to the actual, completed inventory count after the count is done.
Let your staff know when you plan to do year-end counts well in advance and plan it out. Will you close the business for a certain period to complete the counts or count while your store is still operating? Each business is different and has its own restrictions for when and how to complete a year-end inventory count.
Make sure you think about what materials you'll need. Print out item count sheets by store area, category, aisle, SKU, etc. — whatever works best for your business. Some mobile tablet solutions exist for counting inventory but sometimes good old paper works just as well, if not better.
A good count sheet should include the SKU number, product description, and a blank space for the actual count. Shopventory users have easy access to Inventory Reconciliation Worksheets that make it easy to stick on a clipboard and do a count.
Do NOT provide the current count estimates from your inventory system as this will bias the counters.
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3. Do the count.
Divide the store floor into sections and assign one or two counters to each section. If you have the luxury, it's better to assign two people to each counting team so they can both count the same item at the same time and confirm the result. This usually speeds up the overall process and can greatly improve accuracy.
When doing the count, it’s a good idea to set aside phones and gadgets. Texting and taking calls only disrupts counts and can really add up to hours worth of delays.
Make sure to communicate this is not an estimate. Ask for the counters to initial each entry after they count. Let them know you will randomly audit several of their counts to double check for accuracy.
Let your counters know there may be cases of products or loose items above, below, or behind a shelf, or even in the back of the store. If counts are off by a large margin, this is often the reason.
4. Make it as fun as possible.
Bring food, snacks, and drinks for breaks. Or, treat everyone to dinner afterwards for some post-count team-building. Give 10- or 15-minute breaks every hour or two for folks to chat and check their mobile phones for messages. Counting is tiring and people start to prefer speed over accuracy. Making it less of a chore ensures people are more engaged in the process.
5. Assign a troubleshooter.
If a specific item count is off by a large number (you can decide the number), then have one person (perhaps you) who is the designated troubleshooter. That person should be the one to research the discrepancy — in real time if possible — so you can try to find the missing product. It’s more efficient for the counters to stay focused.
6. Manage your overstock.
If you have an overstock/warehouse/back stock area in your store, try to do those counts a day or two before the actual floor stock count. These are usually a lot easier and can be handled by one or two people. This way, the day of the count can be focused only on the area where additional manpower is needed.
Be sure to mark the boxes as counted with stickers or markings to let folks know they should not put that product on the floor until after the floor count is completed.
After you're confident that your counts are good, enter the adjusted counts into an inventory management system like Shopventory. Spreadsheets are awesome, but they are manually managed. Every day that goes by, that information becomes more and more stale unless someone is constantly devoting time to keep them up to date. Shopventory starts at less than a dollar a day for a robot to do the same more reliably and in real time.
When you make adjustments, make sure to note why you're making the change along with the name or initials of the person making the adjustments. Auditing becomes a lot easier if you know who made what changes when. That's why Shopventory lets you add a note to every adjustment made to your inventory. If you discover a large number of discrepancies, you may want to institute monthly or weekly "cycle counts" of specific product categories.
Nirvana is at hand!
Having an easy-to-use, real-time inventory management solution will make your life easier. It also helps eliminate losses and employee theft going forward as your workers become aware of your investment and the importance of tracking inventory accurately as it flows through your store.
In short, a good accurate count lets you know how much money you have tied up in inventory and gets you off and running for the next year... and we'll prove it!
This year, we are offering a full-feature 30-day free trial of Shopventory. In fact, we'll even back Shopventory with a 30-day money back guarantee. That means you get a total of 60 days risk-free to get your inventory ready for the new year!
You can start now with no credit card required! Tens of thousands of merchants trust Shopventory to manage over a billion dollars worth of inventory all over the world. See what all the fuss is about!
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Full Disclosure, this a revision of an article originally written by our CEO Dave Carlson for the Town Square blog. You can find the orginial post at this link: https://squareup.com/townsquare/7/