Glossary
Cycle counting
Cycle counting is counting a few products often, on a rota, instead of counting everything once a year.
Twenty lines on a Tuesday morning. Different twenty next week.
Choosing what to count
Not at random. Weight it by what costs you money to get wrong:
- Your twenty fastest sellers, every week
- Anything with a value over a threshold you set, monthly
- Anything that threw up an inventory adjustment last month
- Everything else, once or twice a year
A line that sells forty a week can drift forty units before anyone notices. A line that sells one a quarter cannot.
Why it beats the annual count
A stocktake tells you the total is wrong. A cycle count tells you which line went wrong and roughly when, because you counted it three weeks ago and it was right.
That second fact is the one you can act on.
Where it goes wrong
The count gets done, the number gets corrected, and nobody asks why. Next month the same line is out by the same amount, because the process that created the gap is still running.
Correcting the number without fixing the cause is the most common version of this, and it is why stock counts drift even in stores that count regularly. Write the reason down every time, and after a month the pattern names itself.
Related terms
Stocktake
Also called: Physical inventory count, Stock count
A stocktake is counting every product you hold and correcting the system to match what is really on the shelves.
Stock accuracy
Stock accuracy is how often the number on screen matches the number on the shelf, counted line by line rather than in total.
Inventory adjustment
An inventory adjustment is a manual change to a stock number, made when what the system says does not match the shelf.