For many of us, it is that time of the year when we think about physical counts. If you are not using cycle inventory counting, chances are you have a physical count in your near future. A well-performed physical count—and more accurate inventory data—can lead to significant reductions in operational and inventory costs.
Accurate physical counts are not just made to please your accountant or the tax auditors, they are a means to providing better customer service. When your counts are accurate, you can have a more effective inventory replenishment system; when your counts are inaccurate, your ordering quantities are wrong, and your customer satisfaction will suffer.
Physical inventory count can be costly due to labor expense and lost production time. That is why it is important to find ways to minimize the time it takes while ensuring inventory count accuracy.
Proper Planning Improves Physical Count Performance
One key to better physical counts is up-front planning. Proper preparation prevents poor performance. Here are some steps to prepare for your physical count to make it more efficient and accurate.
- Carry out a mock count. This will enable you to estimate the time and resources required for your upcoming physical count.
- Inform suppliers, customers, and production. Let them know what to expect in order to minimize disruptions.
- Minimize shutdown. Consider counting surplus areas and slow-moving products in advance. Choose a time and date for the physical count that will create the least interruption in production.
- Establish count areas and assignments. Work out the details of the physical count so that everyone will know their tasks.
- Dispose of obsolete inventory. Clean up your warehouse in advance to remove any roadblocks to a good count.
- Prepare equipment and your software. Make sure that your physical equipment is in working order and charge batteries the night before. Prior to beginning the physical count, prepare your warehouse barcode scanning system. If you are using a SaaS system, be sure that you have enough user licenses for the physical count staff. If you only do physical count once or twice a year, you may need to set up extra users. Prepare your ERP software for the physical count by clearing out old inventory numbers and freezing operations.
- Train your staff. Let your team know the importance of accurate stock balances and be up to date on processes.
- Cease operations completely. Freeze the warehouse activities in your counting area.
- Provide extra support staff. When you need extra staff for the physical count or in other areas, prepare at least two weeks in advance. Often, software vendors can offer support with advance notice.
Inventory Automation Decreases Physical Count Time by 75%
Physical count can be done by hand, but the inventory data won’t get into the database in real time. It also leaves more room for human error. Automating the physical count process will increase accuracy and decrease physical count time. We have found that our warehouse automation customers, on average, decrease physical count time by 75%. What would it mean to your business to take a four-day physical count process down to one day?
Scanco Counts is a Sage 100 mobile application that automates your year-end physical count (or cycle count) from any iOS or Android device. The application seamlessly integrates with Sage 100 Physical Count Entry, eliminating the need for paper counting and data entry. With many hardware accessory options, users can scan barcodes, look up items, and send counts in real time to Sage 100. Scanco Counts also includes item inquiry to give your users a real-time view of inventory levels at any given moment. You improve your physical count accuracy since Scanco Counts has built-in validation with Sage 100 of company, warehouse, items, and quantity data.
Eliminate the most common problems that you face with counting inventory—long count times, closing operations for year-end counts and endless data entry—with Scanco automation tools. Our goal is for your cycle count to be hassle free. In addition to products and support, we offer Scanco University which offers webinars, videos, and how-to guides 24 hours a day.