In small businesses, keeping count of inventory along with checking for inaccuracies in the warehouses may be a bit of a struggle. There are technology tools that assist in managing inventory, but there’s also a need for in-house systems that will be responsible for physical stock counting. A lot of product-based businesses have started to neglect the annual inventory count and instead choose a process that is less vigorous – a process which is ongoing cycle counts.

Cycle counting is an inventory auditing process that takes place continuously throughout the year, helping businesses to only focus on just a part of inventory. Cycle counts are less disruptive to daily operations and give a measure of inventory accuracy. They can also be created to focus on items with higher value and higher movement.

Let’s highlight what the advantages of cycle counting are.

Limited Disruption

The process of conducting cycle counts weekly prevents major disruptions in the warehouse. Annual inventory counts on the other hand take the whole day and require that tasks in the entire warehouse be paused in order to finish the count. Cycle counting allows for inventory to be evaluated consistently and that means less disruptions and more communication between your employees.

Easier Counts

Implementing cycle counts optimizes your warehouse and makes the physical counting easier. It also saves you extra time and effort that would have been exerted at a later stage. For example, breaking down boxes as soon as product arrives will cut down on clutter and keep traffic ways clear.

Increased Buying Decisions Confidence

Ongoing cycle counts prompt you to continuously assess and keep up to date with your inventory. Through this you have smaller check-ins and are able to focus more on a subset of inventory – a factor that will allow you to make more informed and targeted buying decisions. You’re able to avoid stockouts ahead of time and create a better report for buyers on your team.

Fewer Errors

Shortening time between counts helps decrease the amount of time in which errors could have been made. Should there be a discrepancy concerning inventory, waiting several months could cause major problems with consumers and your business generally. Smaller, ongoing counts account for mistakes faster. What will also make certain there are fewer errors is stocking most commonly ordered products together in order to find items easier during cycle counts.


Owning a product-based business can mean having to deal with the frustrations that come with inventory at times. Smaller cycle counts alleviate these frustrations by helping the entire operations team see stock accuracy as an important part of the business. In that way they feel more confident about the decisions you make for the warehouse.

Increased Productivity

While annual inventory may seem like it’s an ideal way to begin a period with a clean slate, it instead drains time and human resources. Cycle counts on the other hand will maximize productivity and encourage clear communication, leading to efficiency. In the first year of introducing cycle counts, monitor how your team is doing because their speed and dedication on executing various warehouse processes influences the bottom line. Asking for their input is key too when you want to improve operations. Don’t underestimate the value of employee feedback because what their instincts provide could be what’s best for the business.

Now that you have mastered the process of inventory count, find out the Reasons Why Inventory Management Is Crucial For eCommerce Sites!

Source: inboundlogistics