Everyone knows knowledge is power and the insight gained by conducting regular stocktakes empowers retailers to be proactive on stock decisions and most importantly increase their businesses bottom line.
Regular stocktaking is good business practice which will prevent many problems as well as confirm the amount of stock held for audit purposes. There are so many benefits to having accurate information on your stock levels including improved customer service and efficiency in your operation, with employee’s who always know exactly what stock is available & where.
For most retailers, it's also a mandatory requirement at the end of the financial year.
The Benefits of Regular Retail Stocktakes
Conducting a regular stocktake will ensure you see benefits which:
- Provide accurate reporting which ensures your accounting is up to date and you are always aware of your profit margin
- Identify slow moving and overstocked products so you can act accordingly with special sales offers. Know that what you are spending your money on is profitable & what stock your store actually needs.
- Reduce back orders – stocktaking empowers business owners to see what moves quickly and reorder in a timely manner.
- Highlights poor practices in your operation or possible cases of theft before things might get out of control.
Ashley Lutz, US Retail Editor of Business Insider reports in a recent Business Insider Australia article that employee theft is such a problem that “Retailers are keeping track of employees suspected of stealing in databases”.
These controversial databases are used by major US retailers to security check potential new staff members. The article goes on to explain that in the US alone, “Employee thefts cost retailers about $15 billion a year”.
Our Top Ten Tips for a better stocktake:
A good guide is to schedule at least 4 ‘whole of inventory’ stocktakes each year as well as scheduling monthly cycle counts which are smaller stocktakes of various departments. Some well run operations with live integrated inventory management POS software consistently run cycle counts instead of performing the traditional full physical inventory count. Retail operations that use a real-time cloud based stock management POS system can easily perform digitised stock counts along with their other warehouse activities during business hours.
1. Always plan ahead to make sure necessary resources are in place so things can run smoothly
2. Choose the quietest time of the day (usually after hours) so that you have minimum interruptions
3. Always conduct a stocktake in a tidy and orderly environment. All inventory should be accessible and sorted into appropriate categories.
4. Organise staff appropriately – appoint a supervisor in each location responsible for overviewing the process. Run reports to consider what stock will be counted and then allocate the appropriate staff levels to perform the count. Teach staff the best system to count stock, such as always running from top to bottom and left to right to avoid count duplications
5. Limit noise and conversation – distractions from co-workers, mobile phones, iPods or having the radio playing can all lead to staff making critical errors
6. Count every item – never estimate & always check the number listed is actually what is inside any unopened box.
7. Mark any items counted to avoid duplication – this will also help identify any item that counters have missed.
8. Make sure the data for the stocktake is valid
- Receive any outstanding purchase orders, inter-store transfers, returns etc
- Decide how you will handle damaged stock
9. Finalise the stocktake and investigate and note any inconsistencies
10. Continuously learn - when completed, review your stocktaking procedures and note any suggestions to further streamline actions and improve your processes for the next count.
If you only stocktake once a year you may be ignoring potential losses through damaged or slow moving stock, theft or problems with warehousing procedures. You will save money by preventing problems and dealing with any stock issues promptly. A successful stocktake doesn’t have to disrupt your business and will give you the accurate information you need to make better operational decisions.
Retail Express offers a completely digital stocktake solution– arrange a free demo today to see it in action!
Looking to fast track your growth with a smarter Retail POS System?
Contact the Retail Express team today on 1300 732 618.