Majority of companies, in a regular scenario, would inspect their stock once or twice a year to reconcile physical stock with the system stock and then adjust the differences. This procedure though important, is very time consuming, requires a complete downtime from operations of around 3-4 days and also involves heavy manual work which can lead to more errors in the process. Since the value of your assets and plant capacity depend on timely count of your stock, it is very important to do this process with utmost accuracy and on pre-scheduled program. In fact, some businesses have made it their core offerings to do these stock counts for companies and they have made good money out of it.
So is there some easier alternative to these tedious and time taking stock take?
Yes. There is – Cycle Count.
Cycle count as the name suggests, is a method wherein you break the task of 1 stop inventory count into multiple small and frequently recurring cycles of inventory count generally by category of items. This method has numerous benefits/advantages as compared to conventional stock take process.
This method is time saving, reduces the ‘non-operational’ days, reduces chances of huge inventory adjustments at end of year and helps maintain more accurate inventory throughout the year.
This process can be easily implemented in Sage 300 ERP by doing the stock take by locations and by category of items. For example we can define high value products in category A and schedule a cycle count for it once every month while items with lesser valuation can be counted less frequently.
Standard Physical Inventory Process of Sage 300 is very intuitive so the users need not maintain paper records of what inventory was counted last and when. Every time an inventory worksheet is generated it can be stored in PDF or several other formats for quick and easy retrieval at later stage.
Cycle count is most suitable for organizations with very accurate data entry methods and where general inventory variations do not exceed 10%. Though the purpose of this method is to avoid humongous efforts at year end, it does not ensure accurate results if not properly planned and implemented
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