When to run a stock count: the calendar and how often

Many companies leave the stock count to the end of the year because that is when accounts are due. As a result the count lands in the busiest period: sales at their peak, the accountant occupied with year-end closing, and the contractors' queues at their longest. In fact "when" and "how often" are separate decisions, and they should follow the rhythm of your own business.

The risk of waiting for year end

When you count once a year, shortages pile up for twelve months. At year end you see the figure "missing", but the cause is long gone: who received the goods, in which month the mistake happened, which document was left open, nobody remembers. A small difference can be found within a month, while a large one is almost impossible to explain a year later. A conditional example: say a shop accumulates an unexplained difference of half a percent of turnover each month. In one month you do not notice it; over twelve it reaches six percent, and no trace is left to find the cause. So even a company that limits itself to one full count a year should run at least selective counts in between.

Convenient windows

The best time for a count is when sales and goods movement are at their lowest. Every business has such a period:

• In a shop or wholesale depot sales rise before holidays, while the first weeks after a holiday are usually quiet.
• For building materials, late winter and early spring, before the season opens, are convenient.
• In clothing, stock is reviewed anyway when the season changes, so it makes sense to combine the count with it.
• In online retail the quiet week after a big promotion suits well: returns have been collected and balances are steady.

Do not count just before promotions, holidays and large deliveries. At those times documents change fast and it is hard to hold an exact cut-off on count day. Think about the day and hour too: in the evening or on a day off there are fewer customers.

How often to count

Not every item needs counting at the same frequency. A simple scheme divides goods into three groups:

1. Expensive or fast-moving goods. These positions carry a high risk of shortages, so it makes sense to count a selection of them once a month.
2. The middle group. Counting once a quarter is usually enough.
3. Cheap, slow-moving goods. It is enough to go through them once a year, during the full count.

Goods with a limited shelf life, such as food or medicines, should additionally be checked more often. The scheme is approximate: set the group boundaries yourself, based on your goods, your history of shortages and the number of staff.

This extra work is smaller than it looks. Say 200 of 2,000 positions fall into the expensive group. Counting them once a month means going through a tenth of the list, a few hours for one person, not a count that stops the whole warehouse.

Counts triggered by events

There are cases when you need to count outside the calendar:

• When the warehouse manager or the financially responsible employee changes, so the newcomer does not take on someone else's shortage.
• When a new branch opens or the warehouse moves.
• When a shortage is suspected or a signal of theft arrives.
• When selling the business, splitting with a partner or taking a loan, that is, when the exact value of the stock is needed.

When the responsible person changes, both the old and the new employee should be present and sign the result, otherwise it is unclear later who answers for what. Such a count comes up unexpectedly, so it helps to stay in touch with a contractor in advance.

Building the annual calendar

At the start of the year, write a one-page plan: which month for the full count, which months for selective ones, who is responsible, which contractor. Towards year end contractors' queues grow, so it is better to book the time for the full count early. Tell the staff about the plan as well: then the count is seen not as a sudden "inspection" but as the normal routine.

Conclusion

A stock count is not a "year-end duty" but a control tuned to the rhythm of the business. Choose a window with low sales, count expensive and fast goods more often and the rest less often, and be ready for a count triggered by an event. StockCheck works both one-off and on a regular basis: we count once a quarter or every month on a schedule and deliver the report.