Stock taking and inventory management are key parts of running your small business. You need to be on top of stock control to make sure you\u2019re accurately measuring your efficiency and performance.<\/p>\n\n\n\n
But what is a stock take and why is stocktaking an important part of running a shop or warehouse?<\/p>\n\n\n\n
A stock take, or inventory management, is the process of checking your inventory \u2013 how much you have in stock, as well as the condition of goods \u2013 and recording the results in a report.<\/p>\n\n\n\n
Stocktaking helps with your stock<\/a> control. For example, if you sell food, you\u2019ll need to know when items are due to reach their sell by date so you can refresh the shelves when necessary.<\/p>\n\n\n\n And if you\u2019re a manufacturing business, a stock take can help you make sure you have all necessary components available to do your work.<\/p>\n\n\n\n Depending on your business model, you may still be able to operate when a certain item is out of stock. This is known as a back order<\/a>, and is when you accept orders but have temporarily run out of stock in your warehouse.<\/p>\n\n\n\n The types of goods you sell will usually determine how often you should do a stock take. As above, food and drink businesses should check their stock regularly, as their goods are perishable.<\/p>\n\n\n\n But other businesses might choose to do an annual stock take \u2013 it depends on the specifics of your business.<\/p>\n\n\n\n A stock take helps you:<\/p>\n\n\n\n Effective inventory management can improve your cash flow<\/a> and help reduce waste in your business. It also helps you check you have enough stock to complete the work you need to do. <\/p>\n\n\n\n If you work in hospitality, for example, inventory management is a crucial process because you need enough stock to serve your customers but not too much that you waste it. If you manage your stock well, you\u2019ll order just enough produce to cover what you need and won\u2019t lose money on wastage. <\/p>\n\n\n\n But inventory management is important for all industries. If you run a clothing business<\/a>, you don\u2019t want too much of any product as you might struggle to sell it \u2013 or run out of space to store it. You need to manage your inventory to avoid ending up with dead stock<\/a> while still having enough to meet the demand of your customers. <\/p>\n\n\n\n There\u2019s no getting around the fact that a stock take is time consuming. You need to dedicate time to the process, which should help you limit distractions and errors.<\/p>\n\n\n\n You\u2019ll need to work out how regularly you\u2019re going to do stocktaking:<\/p>\n\n\n\n Your stock sheets form the basis of your stock take. You use them to record your new count, against what should be there. The stock sheets should use the most up to date records you have.<\/p>\n\n\n\n These should be embedded in your existing stock control system and many software packages let you print stock sheets out. <\/p>\n\n\n\n But be sure to use the stock sheets in the right order:<\/p>\n\n\n\n Otherwise, using the sheets as the basis of your count can lead to errors.<\/p>\n\n\n\n Make sure you set aside any stock that\u2019s already been sold, but is yet to be delivered or picked up by a customer.<\/p>\n\n\n\n As part of this, you should also pause all purchases and sales, because it\u2019s easier to make an error if you have shifting stock while you\u2019re trying to do your count.<\/p>\n\n\n\n After this, you should start categorising your existing stock. Make sure your stocktaking area is clear and clean to minimise the risk of errors.<\/p>\n\n\n\n Your total stock will likely fall into a number of different categories and it\u2019ll be easier to properly account for everything if you develop a system to start with. This might involve physically moving items around your premises, sorting them into categories, and counting on that basis.<\/p>\n\n\n\n If you have staff helping out with your stock take, make sure that they\u2019re properly organised. Once you\u2019ve categorised your stock, you could appoint a separate staff member to each category.<\/p>\n\n\n\n Remember to appoint more staff to larger categories. You should also minimise any distractions \u2013 ask employees to switch their phones off and avoid using the radio, for example.<\/p>\n\n\n\n So nobody burns out, you should take breaks<\/a> during the process. Stocktaking isn\u2019t fun and it\u2019s important to regularly recharge.<\/p>\n\n\n\n Accurate stocktaking requires methodical counting \u2013 no guessing. Mark items as you go in order to avoid duplicate counting.<\/p>\n\n\n\n Again, you can simplify the process significantly by using logical categories for stock, and by making sure that any sold items have already been removed from the areas being counted.<\/p>\n\n\n\n Plus, remember to simply count items on the shelves first, before using your stock sheet or looking at your stock control system to see what should be there.<\/p>\n\n\n\n Once your count is finished, you need to validate your stock take. Compare the results of the count to the stock records you printed out earlier. Any inconsistencies should be noted and accounted for \u2013 for example, you need a procedure in place for dealing with damaged items.<\/p>\n\n\n\n If you have multiple branches, make sure that you\u2019re properly tracking store transfers, and that purchase orders<\/a> are being effectively dealt with.<\/p>\n\n\n\n Discrepancies can be serious, so it\u2019s important to investigate their cause. Is an item simply in the wrong place, is there an issue with your supplier, or are there problems with your stock control system in general?<\/p>\n\n\n\n The good news is that a stock take is the first step to solving a problem, so you can make sure that it doesn\u2019t happen again.<\/p>\n\n\n\n Finally, you need to update your stock records with the results of your latest count. If you\u2019re using a software solution to track stock, this should be a simple process. If you\u2019re still using paper-based systems, you could consider moving to a digital alternative.<\/p>\n\n\n\n There\u2019s stock take apps that make the inventory management process much easier. Which one you choose will depend on your trade and the size of your business. Take a look below at some of the best inventory management apps for your business to help improve the stock taking process.<\/p>\n\n\n\n Zoho<\/a> is a cloud-based inventory management software solution that connects to a range of ecommerce platforms<\/a> and updates whenever you make a sale. Not only does Zoho allow you to manage your stock levels through barcode scanning and sales tracking, but you can also enable automatic reordering when you\u2019re running low on certain items.<\/p>\n\n\n\n Prices start from \u00a325 covering two app users for up to 500 orders a month from one warehouse \u2013 making it perfect for a small business.<\/p>\n\n\n\n If you run a shop or are selling online, Zettle<\/a> may be a good option for you as it also works as a point of sale system<\/a> as well as inventory management software. Zettle can give you automatic alerts when you\u2019re running low on stock, as well as allowing you to track your sales to work out the popularity of your products.<\/p>\n\n\n\n As Zettle is a point of sale system first and foremost, prices start from 1.75 per cent of every sale made.<\/p>\n\n\n\n Designed specifically for small businesses, Sortly<\/a> allows you to track your stock levels from your phone, tablet, or desktop. As well as tracking inventory, Sortly also allows you to track any assets such as tools and vehicles \u2013 making it the perfect inventory management software for construction businesses.<\/p>\n\n\n\n If you\u2019re a sole trader or just starting out, you can join Sortly on a free plan which allows you to track up to 100 items. If you need more than that, small businesses would be best suited to their advanced plan, which costs $29 a month and covers up to 2,000 items and includes unlimited QR labels to help with taking stock.<\/p>\n\n\n\n SKULabs<\/a> is another inventory management system that also covers order management and catalogue management. It integrates with your various online shopping platforms (such as Amazon, Etsy, and Shopify) so your stock levels are always automatically updated.<\/p>\n\n\n\n You can also print shipping labels and validate your customers\u2019 addresses to help make your ecommerce business run more efficiently.<\/p>\n\n\n\n With so many features, SKULabs is on the pricier end of apps on this list \u2013 with the starter plan starting at $299 a month.<\/p>\n\n\n\n Looking for a free option? Microsoft Excel (or its equivalent) can be a great way for small businesses who are just starting out and looking for a basic option for their inventory management.<\/p>\n\n\n\n Some ideas for columns include:<\/p>\n\n\n\n A stocktake is the process of counting and recording all the products a business physically has. A stock take helps you order the right amount of stock and enables more accurate financial reporting.<\/p>\n\n\n\n To give you an example of how inventory management works in practice, imagine a baker running a cake making business.They check what ingredients they use each week. If they’re running low on something, they order more before they completely run out. But they also don’t order too much, so fresh ingredients like eggs don\u2019t go out of date.<\/p>\n\n\n\n The benefits of stocktaking mean more accurate financial and tax reporting, less waste or dead stock, and better financial forecasting. <\/p>\n\n\n\n Stock check and stock take mean slightly different things. A stock take is a comprehensive count of all of your products and is typically done a few times a year. <\/p>\n\n\n\n A stock check is a more frequent, quick check on your stock to make sure you have enough of what you need. <\/p>\n\n\n\n As the UK’s biggest business insurance<\/a> provider, we protect more shops, trades and retailers than anybody else for the likes of public liability insurance<\/a> and more. Why not take a look now and build a quick, tailored shop insurance quote<\/a>?<\/p>\n\n\n\n\n
Why inventory management is important<\/strong><\/h2>\n\n\n\n
How to do a stock take<\/strong><\/h2>\n\n\n\n
1. Choose how often to do stocktaking<\/strong><\/h3>\n\n\n\n
\n
2. Print your stock take sheets<\/strong><\/h3>\n\n\n\n
\n
3. Organise your stock before the stock take<\/strong><\/h3>\n\n\n\n
4. Organise staff<\/strong><\/h3>\n\n\n\n
5. Avoid guesswork<\/h3>\n\n\n\n
6. Validate your stock take<\/strong><\/h3>\n\n\n\n
7. Update your stock records<\/strong><\/h3>\n\n\n\n
What\u2019s the best <\/strong>inventory management software<\/strong>?<\/strong><\/h2>\n\n\n\n
Zoho<\/strong><\/h3>\n\n\n\n
Zettle<\/strong><\/h3>\n\n\n\n
Sortly<\/strong><\/h3>\n\n\n\n
SKULabs<\/strong><\/h3>\n\n\n\n
Excel<\/strong><\/h3>\n\n\n\n
\n
How to do a stock take – FAQs<\/strong><\/h2>\n\n\n\n
What does stocktake mean?<\/strong><\/h3>\n\n\n\n
What is an example of inventory management?<\/strong><\/h3>\n\n\n\n
What are the benefits of stocktaking?<\/strong><\/h3>\n\n\n\n
Stock check or stock take \u2013 what’s the difference?<\/h3>\n\n\n\n
All set with retail insurance?<\/h3>\n\n\n\n