Stock Take Software
Finale Inventory offers many features to manage stock at your warehouse inventory. Our real-time tracking can significantly reduce the amount of time you spend counting by hand. Still, it can’t wholly replace physical inventory counts. Whether you experience shrinkage or someone forgets to scan a barcode, the number in your software might not match up to the real count. For those instances, you might do a physical stock take to “reset” your inventory counts. Finale Inventory makes this process simple.
What Does Physical Inventory Count Mean?
Physical inventory, also called a stock take, is the process of counting or measuring the stock at a company’s location or sub-location. The stock quantities from a stock take system are known as the quantity on hand. They represent the quantity physically present, independent of whether the items have been reserved for future sales.
Stock take system practices vary in frequency for different kinds of businesses. For retail and restaurants, a company may do a cycle count daily or weekly to keep a regular count of what is on hand. Other types of businesses, such as wholesale, distribution and manufacturing, may use cycle counts less frequently to verify and correct stock levels. Inventory is kept up-to-date between stock takes based on the quantity deltas from shipments received or sent from purchases, sales and transfers.
Physical stocktaking procedures take many forms. Businesses may do cycle counting on location using paper and pencil, typing into a mobile device or scanning with a barcode scanner. Whichever process the company uses, Finale Inventory’s cycle count software process facilitates efficient counting of the stock items and recording them on the fly or after the stock take is completed.
A stock take, or physical inventory, is the process of counting or measuring the stock at a company’s location or sub-location. The stock quantities from a stock take system are known as quantity on hand, as they represent the quantity physically present, independent of whether the items have been reserved for future sales.
Examples From Finale Inventory
Here is a stock take example, with a video using Finale Inventory for a cycle count.
Finale Inventory makes stocktaking easier. When you pull up the stocktaking function, you’ll be able to select your warehouse sublocation. This feature is useful for any facility that takes stock section by section rather than all at once. Once you’ve chosen your sublocation, you’ll find a list of merchandise and the quantity on hand.
Finale Inventory’s automated stock count tells you precisely what the number should be. It adds inventory based on your purchases and subtracts them based on your sales. As you’re doing your physical count, you have a quick reference for what the number should be.
You’ll input your actual count right next to the expected count. Any variance from the expected quantity will calculate automatically. This variance helps you quantify and correct inventory discrepancies. When something doesn’t add up, you can find the root cause. After you reset your numbers during a physical count, you’re back on track to collecting accurate inventory data.
What Is Stock Take Software?
First things first — what does physical inventory mean? Physical inventory refers to the stock that’s actually in your warehouse. It doesn’t include shipments that have yet to arrive and includes products sold that have yet to ship. The physical inventory doesn’t always match what your receiving and shipping records say. Items can get misplaced, stolen or damaged. That’s where a stock take comes in, allowing a business to get an accurate count of what’s in the warehouse.
The Difference Between Stocktaking and Stock Checking
It’s also important to note the difference between stocktaking and stock checking. With stocktaking, the goal is to count the physical stock available. During this process, you’ll discount and discard damaged or expired inventory. Stock checking makes sure you can meet customer demands and happens continuously, through real-time tracking of your inbound deliveries, sales and outbound shipments.
Stock take software lets you move your stock counts from a spreadsheet to a convenient inventory tracking platform. Finale Inventory offers a basic method for inputting stock takes and even barcode integration.
Stocktaking is a useful feature in your physical inventory management system. It lets you account for shrinkage and inventory discrepancies. The software updates your stock count in real time based on the items you receive and sell from your location. The number is continuously updating based on the operations going on in your warehouse. This feature reduces the amount of physical stock takes you need to run.
While this solution gives you high visibility, the counts can become less accurate over time. The stock take features let you run a manual count, organize your data in a central location, and update your quantity on hand.
By comparing your physical stock take to a continuous count, you can gain a wealth of operational data. At any time, you can do a stock take audit and view a history of all the changes made to the quantity. This information allows you to see who conducted the physical take and when. Then, you can follow up with the right person about any discrepancy from the expected inventory.
Why is Stock Take Important?
Conducting physical stock counts using software allows you to to do many things, like:
- Maintain inventory accuracy for accounting purposes.
- Track and limit shrinkage.
- Make smarter purchasing decisions based on the number of products that expire before they are sold.
Best Practices: Leveraging Stock Take Software to Maximize ROI
When you have software to ensure stock take accuracy, you can take advantage of many features to enhance your inventory tracking. These three best practices give you the most use out of your stock take software:
1. Categorize Your Inventory Using ABC Analysis
Many warehouses organize stock into three categories. Your “A” inventory is only 20% of your products but generates 80% of your sales. Your “B” inventory takes up another 30% of your stock and contributes 15% of your sales. The bottom 50% of your inventory, your “C” inventory, makes up 5% of your sales.
Tracking inventory shrinkage by category lets you make the best decisions for your business. For example, category A shrinkage should be a higher concern than shrinkage in other categories.
In your stock take software, you can track cycle counts categorized into A, B and C inventory. You might do this by including these letters in your sublocation labeling system.
2. Use Barcode Scanners
There are many types of stocktaking methods. Some use pen and paper or spreadsheets. By far, the most accurate is using mobile barcode scanners. They let counters input data directly into a centralized platform while on the move. There’s less chance for something to get miscounted in the fray because counters must scan barcodes to input data. If there is any discrepancy, the barcode scanner will highlight it, letting the counters know to recount and ensure stock take accuracy.
3. Analyze Your Reports
While conducting a physical stock count lets you reset your inventory software’s data, it also provides some key insights. Take advantage of these reports to track shrinkage and items stored in the wrong locations. You can also see if merchandise is being undercounted, meaning you have products in the warehouse that your software didn’t know about.
Using Finale Inventory for a Cycle Count with a Barcode Scanner
A cycle count is one way of organizing your physical inventory counts. Instead of conducting a full stock take all at once, you can maximize your time by doing periodic cycle counts. There are many ways to divide up and schedule cycle counts, and you can manage them all in Finale Inventory.
One way is to divide cycle counts by type of item. For example, if you have items with a fixed expiration date, such as food, you might schedule cycle counts in line with their window of sellability. In other cases, it may make more sense to cycle count by ABC. Count your A category items most often since their count accuracy has the most significant impact on revenue.
Finale Inventory offers many features for different types of stock takes, including stock auditing and simple stock takes. Our process for cycle counts makes it easier to do a physical count of your warehouse without pausing all operations. Here’s how it works:
- Update your mobile barcode scanners: Finale Inventory’s integrated barcode scanners need to sync with your inventory software before you begin. This ensures all the recent scans are up-to-date in your software for an accurate expected count.
- Pause operations for your category: While cycle counts prevent you from shutting down your whole warehouse, you still need to stop receiving and shipping the items in the cycle category during the physical count. It’s helpful to organize your sublocations by cycle to streamline this process. As soon as you update your barcode scanners, close off those locations to everyone except the stock auditors.
- Select “stock take”: On your barcode scanner, scroll down to the “stock take” function. It should be the fourth option on the list.
- Enter your sublocation: Your barcode scanner will prompt you to scan the sublocation in your warehouse. You’ll scan in each sublocation as you go.
- Enter the quantity: For each type of product stored in a sublocation, you’ll first scan the barcode. Then, enter the amount by hand using the up and down arrows. You’ll have to scan a barcode for each separate item in the sublocation. You can also enter the quantity for each item by scanning each item separately. If you’re tracking inventory by serial number, you’ll have to scan each product’s barcode individually.
- Sync your barcode scanner: Once you’ve completed your cycle count, sync your barcode scanner up with the Finale Inventory software. You’ll update your stock counts with any discrepancies to ensure an accurate count moving forward.
Alternatively, you can conduct a stock via a spreadsheet and then import the spreadsheet into Finale to get the cycle counts into Finale.
Physical Inventory Best Practices
Stocktaking for a warehouse might look slightly different from stocktaking at a store location. For example, many stores may need to conduct inventory takes weekly or even daily.
Stock Take Best Practices in retail
Here are some best practices for the stock take process in retail:
- Start with partial stock takes: It’s faster to use cycle counts rather than a full stock take. That’s because you can quickly count one item at the end of each day after the store closes. Because you focus on one small section or even one product, you don’t get lost in a sea of numbers during an hours-long process.
- Plan full stock takes: Cycle counts should cover many of your physical inventory responsibilities. However, the best stock take procedures in retail dictate doing a total count of your inventory at least twice a year.
- Train your counters: Your counters should know the process they’ll use to conduct the stock take. Will they scan barcodes individually, or count products by hand and input the number into a barcode reader? They should know what sections and products they’re responsible for. They should also know what to do if they discover damaged or misplaced products.
- Map your route: Start your stock take with a complete map of your store and storage area. You can then assign employees to sections so nothing gets left behind. Mark everything in the store as clearly as possible. Uncover mislabeled merchandise and organize everything before the stock take begins.
- Close your store: To ensure an accurate count, you can’t allow customers to buy anything or take in any new shipments. A full stock take will also take time and require a lot of focus. Keeping customers out of your store ensures your team won’t get distracted.
How to Do a Stock Take in a Warehouse
In a warehouse, stocktaking happens more irregularly than it does for retail locations. It can happen even less frequently thanks to real time inventory tracking. As with a retail stock take, it’s best to focus on cycle counts for the majority of your physical counts.
Warehouse Stock Take Steps
For those times when a full stock take is necessary, follow these steps:
- Plan: In a large warehouse, a total warehouse stock take will require you to suspend operations. The whole stock take could take several days. If you have an off-season, schedule your stock take then. Notify your team of a planned stock take, and train counters beforehand.
- Prepare your warehouse: Ensure each rack and shelf is organized, and all stock is visible. Clear out expired and damaged items before the stock take so they don’t get accidentally counted. Next, map out your warehouse so you can have a bird’s eye view of your stock take plan.
- Prevent human error: Warehouse-wide inventory tracking can be an incredibly exhausting process. When counting by hand, it’s easy for counters to grow fatigued. Barcode scanners can make things move more smoothly and ensure more accurate counts. They also cut out the middle step of consolidating stock counts for data entry. Besides this, it’s also a good idea to provide plenty of food, water and time to rest.
- Use stock software for warehouses: Physical stocktaking is much easier when you have the right software. It’s essential to use multi-location tracking. You may also need to track inventory by serial or lot number. Finale Inventory has these and many other functions for warehouses, letting you streamline stock takes.
Convenient Functionality With Finale Inventory
Manual stock takes are just one of the many features available in Finale Inventory. We offer many features for warehouses and e-commerce fulfillment and easy integrations with various business tools. Some of the features you might find useful include:
- Barcode inventory management: Barcode-based inventory management has a considerable advantage when it comes to physical stock counting. It can also improve inventory accuracy throughout your warehouse. Our barcode scanners and software can receive shipments, pick and pack orders, log sales shipments, transfer stock and handle other inventory tasks.
- Purchasing and replenishment: Informed by both your real-time and manual stock takes, Finale Inventory offers advanced reorder point calculations. We’ll help you decide when to reorder and give you automatic alerts based on sales velocity and vendor lead time.
- Serial and lot number tracking: Lot tracking can come in handy when you work with short shelf-life inventory. Serial number tracking is necessary for specific industries that work with high-value inventory, such as electronics. These situations also tend to require more physical stock takes. Having an intuitive way to track inventory on a lot or serial number level is crucial.
- Manufacturing and assembly tools: If your warehouse also handles light manufacturing and assembly, you need more tracking capabilities. Finale Inventory lets you track supplies throughout the production process with a bill of materials. You can track raw materials, finished goods and work-in-process goods all at once.
- Product kitting: Inventory tracking for e-commerce can benefit from product kitting tools. You can track inventory separately, even when they are sold together as a kit. Finale Inventory will map kit components back to their unique codes so your warehouse can maintain stock visibility.
Contact Us for a Free Trial or Real-Time Demo
Finale Inventory is a full-featured inventory management solution that helps you track inventory in real time while validating your data with manual stock takes. We offer the ability to perform stock takes with or without barcode scanning, depending on your business needs.