Scheduling cycle counts in the app

Stopping the warehouse once a year to count the lot is costly and inconvenient: work halts for several days, people get tired, and the result arrives at year end, eleven months after the shortage began. Cycle counting works differently: every day a small part of the list is counted, and over the year everything is covered several times. The hard part is planning: what to count, when and how much. Below is how to build the calendar in a spreadsheet or counting software.

Divide the list into three classes

Not every position matters equally. Split the goods into three classes by turnover value: class A holds expensive, fast-moving positions, class B the medium ones and class C the rest. As a sample, the frequency could be: class A once a month, class B once a quarter, class C twice a year. You set the exact limits to suit your own warehouse.

Working out the daily volume

An example. A warehouse has 2,400 positions: 300 in class A, 700 in B and 1,400 in C. The number of counts over a year:

• A: 300 × 12 = 3,600;
• B: 700 × 4 = 2,800;
• C: 1,400 × 2 = 2,800.

That makes 9,200 counts. There are about 250 working days in a year, so 9,200 / 250 ≈ 37 positions a day. If, in cycle counting, a person gets through about 45 positions an hour including checks, that is 50 minutes a day. One employee spends under an hour, and nothing needs to stop the whole warehouse.

Cycle counting has another benefit: when a difference turns up, its cause is still fresh. The trail of a month-old shortage can be followed; that of a year-old one almost never.

Building the calendar

Once the sums are done, spread the list over the days:

1. Assign each zone a fixed day of the week, for example zone A1 on Monday, A2 on Tuesday. Staff get used to the pattern.
2. Spread the class A positions evenly over the weeks so they do not pile up on one day.
3. Schedule counting at a quiet time: at the start of the day, before receiving and dispatch begin.
4. Shift the calendar in advance for holidays and days off.
5. Post the schedule where staff can see it, or keep it in a shared file.

A day runs briefly. In the morning the employee takes the daily list, counts for 50 minutes, recounts a position with a difference on the spot and records the result with the cause. In the evening one short summary goes to the manager: how many were counted and how many show a difference.

Counting outside the plan: triggers

Some situations call for counting a position outside the calendar:

• the books show a zero balance but goods are visible on the shelf;
• the booked balance has gone negative;
• after a large return or write-off;
• when a customer could not get an item recorded as "in stock";
• if the previous count's difference exceeded the set limit, a recount two weeks later.

Such positions join the list on top of the daily quota.

Updating the plan from the results

Review the classes every quarter. A position that keeps showing differences moves up a class and is counted more often. One that has come out clean three cycles in a row drops to a lower class. Say forty class C positions passed three times without differences: move them to a once-a-year count and spend the freed time on trouble spots. This way the plan fits the real state of your warehouse ever more closely.

Cycle counting lightens the pressure of the big annual stocktake, but whether it can replace it entirely depends on accounting rules. Find that out from your accountant in advance.

Common mistakes:

• There is a plan but nobody who prepares the daily list.
• Only convenient zones get counted, and the awkward corner never comes up.
• The daily volume is uneven: a hundred positions on Monday, five on the other days.
• Results are not gathered and the classes do not change even in a year.

Conclusion

Cycle counting swaps one heavy burden a year for a small routine every day. The key lies in dividing into classes, working out the daily volume and updating the plan from the results. If you cannot run such control yourself, the ongoing control service from StockCheck draws up the cycle count plan and hands over a monthly report.