How to prepare for an effective stocktake in 12 easy steps

In the first of a series of articles, George Armstrong, CEO at Scanmatix, advises The Hardware Journal readers on how to prepare for an effective stocktake.

Did you know that from our experience, about 60% of the time retail inventory is not accurate? That means you are in danger of not selling something you have or tying up money in stock you don’t need. Either way it’s not good for business. So, rather than considering stocktaking as a necessary evil, think of it as a great opportunity to tighten up your stock control and contribute to the profitability of your business.

But before you start counting, you need to thoroughly prepare.

1. Plan the date and time.
Pick a day that isn’t too busy and avoid delivery days. Consider starting early in the morning before trading starts or stocktaking in the evening after close.  Don’t pick a date just because your accountant wants it!

2. Decide who is going to complete the stocktake.
Do you have your own equipment and team? Or do you need equipment or professional support?

3. As you approach your stocktake date, run stock down.
Don’t open full boxes from the stockroom unless necessary and hold any large deliveries until after the stocktake.

4. Make sure all items are scanning at your till.
Assign Product look Up’s (PLU’s) to any items that need them and ensure codes and prices are allocated to all stock, particularly in the yard or any loose items stored in bins.

5. If outsourcing your count, export your product file to your stocktake provider who will perform the stocktake.
Remember that any new products and codes you add after exporting the file will not scan during the stocktake.

6. Make sure all barcodes are accessible.
Items held off-site should be listed for entry or scanned in advance. Ensure all items to be counted are in the stocktaking area (extensively check every area of your shop/site).

7. Decide on the type of count you need.
Items like paint should always be single scanned, where every barcode on each tin is captured. Items like screws, nails and fixings can be scanned once and then a quantity entered.

8. Prepare the stock.
All products should be stacked neatly and clearly visible. If you have stock items hidden behind others, they are going to be missed and cause counting errors.

9. Decide what to include.
How will you manage deliveries, returns, damages, credits, deposits, out-of-date stock, sale or return items?

10. Schedule sufficient staffing.
You need to make sure that your usual retailing is not affected. Who will ensure the accuracy of your team’s counts? If you’re using an external company, you’ll need someone to assist and to perform rechecks to make sure their counts are accurate.

11. Batch all areas of stock just before the stocktake starts.
Every bay of stock should be given a numbered area label. These labels should run sequentially.

12. Don’t move stock around during the count.
If you bring stock from the stockroom to the shop floor during a stocktake, it could end up being counted twice or not counted at all.

These preparation steps should apply to most retailers but I know that every business is unique so it’s up to you to decide how you want to stocktake, what is included, what reports you want to see afterwards and whether you want to do it yourself or get professional support. This latter might seem like a costly option, but it can end up saving you money.

George Armstrong, CEO at Scanmatix

In our next article I’ll cover how to deliver an effective and efficient stocktake. In the meantime, if you’d like to discuss your stocktake requirements with Scanmatix, one of Ireland’s leading multidisciplinary inventory management companies, please get in touch at 01-554 7359, info@scanmatix.com.

This Business Support article featured in the January/February 2022 issue of The Hardware Journal.