Warehouse Dispatch

Cycle Counting Is Key to Inventory Management

Posted by Reid Curley on May 26, 2017 8:00:00 AM

shutterstock_387267499.jpgHaving a proper inventory counting schedule is one of the most important elements of inventory management. Cycle counting is an advanced, fluid form of inventory counting that offers greater insight into your inventory by continuously tracking and updating data throughout the year. It results in more consistency than an annual or bi-annual counting system and costs substantially less in terms of downtime and disruption.

Stop Interrupting Business As Usual

As a company switching from an annual physical inventory to cycle counting, one of the biggest differences you will find is the ability to continue running your business as normal even as your counts are being completed. Many companies dread annual inventories because it requires weeks of preparation and cleaning, followed by several days of diverting all resources to counting. This unnecessarily prevents you from getting orders out the door on time, and somehow allows your warehouse to devolve into a state of disarray in the months between inventory counts. Cycle counting fights the forces of entropy and demands that your warehouse stay in inventory-ready condition year round.

Prioritize Accuracy

With cycle counting, your highest value and/or highest demand items will be subject to counts on a regular basis while less valuable or popular items will still be counted at least once each year. This system closes the gap on inaccuracies by accounting for all items in the warehouse each cycle. Discrepancies can be corrected before they grow into larger problems, and the immediacy of the correction allows for better investigations into the cause of errors. This means problems can be properly corrected, so they won't continue into the future.

Improve Management Decisions

After implementing a cycle count system, your management team will benefit from a wealth of new information with which to make important buying decisions. This means you can limit the amount of "buffer" inventory that you maintain and have greater confidence in your purchasing decisions.

Your organization will benefit from cycle counting from top to bottom. On the ground level, it will eliminate hasty cleanups and stressful days of operational disruptions. At the highest levels, it will provide more complete data sets for managing inventory day to day. Throughout the year, you will find that cycle counts boost operational efficiency all around, especially because your warehouse will be under checks and balances full time to keep things organized. Once the system has been fully implemented, it will open up whole new worlds for improved inventory management and controls.


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Topics: Cycle Counting

Reid Curley

Written by Reid Curley

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