By using this site, you agree to this use. This issue, stocktaking and verification are not restricted only to business sectors and are no longer a new exercise for it has … In terms of stock damage, the stocktake will highlight where and why stock damage is taking place. So you may have to reduce the price or move the product to a different location to move the stock on. For example, a bread producer's stock includes … How is Stocktaking Important? So, do you really need a blog to tell you that counting the stock is good even though technically you would already know your stock levels when you order you items/materials/parts as you have specified the quantities ordered and received? There may also be a verification step, where the count results are compared to the inventory unit counts in a … n. 1. Share 0. According to Morrison (1982), stocktaking is a complete process of verifying the quantity balance of the entire range of items held in stock. stocktaking synonyms, stocktaking pronunciation, stocktaking translation, English dictionary definition of stocktaking. Reality in the retail business is that theft happens and will... 2. 2. When I started as a graduate I was not really aware of the purpose of stocktaking or importance of stocking. CHAPTER ONE. REASONS FOR HAVING A STOCKTAKE. as life is important to mankind, so also stock is important to every organization. A stocktaking document (APS+), was adopted last September by [...] the Commission and focused on the priorities and the initiatives, on recalling all meaningful suggestions made by the Council and the European Parliament and on major changes which occurred after the adoption of the APS either in the budgetary procedure or following the results of Council's meetings. There are many reasons ranging from damage of products in storage (leakages/damage in transit) to items returned in unsatisfactory condition for resale and theft of stock that the numbers in your records may not necessarily correlate to current actual stock you have on your premises. Excess and Obsolete Inventory Policy Guide, is a Manufacturing Operations, Procurement and Supply Chain leader from international multi-site manufacturing experience in Electrical, Hydraulics and Internet industries, Materials Management Technical Competencies Self Assessment Tool, 5S – Kaizen Guide: Organizing the Workplace for Flow, A Comprehensive Six Sigma Project Checklist, The Ultimate Guide to Inventory Planning Methods, Warehouse Audit Tool – To Improve Warehouse Performance. This in turn will lead to increased profits in the future. You may have to invest in more robust measures such as better quality tagging and closed-circuit cameras to allow for better capture and prosecution of offenders thus sending out a message to other would-be shoplifters of the consequences of the high chance of getting caught. Top 7 for Beginners, APICS VS CIPS – What Should You Choose? stocktaking can be further said to be the check of stock of materials and components in store with a view to check the balance as shown on the stock records with the physical stocks in the bin/rack and with the looks of account by valuation. One of the key purpose of stocktaking is to physically go and see the dust of the dead and slow-moving inventory, again emphasising better inventory reduction strategies. You will never be able to stop shoplifting completely but by having a regular stocktake you can highlight if a security review is required and could discourage rogue employees from stealing. Whether be traditional stocktaking, periodical, perpetual or cycle counting employed according to the choice of the management, stocktaking streamlines inventory control as it helps identify risks, errors, theft and opportunities related to supply, production, distribution and storage. A stocktake gives you the perfect opportunity to analyse your sales, profits, which products are flying off the shelves and those staying on the shelves. This number has to be as accurate as possible, which alone emphasise the importance of stocktaking. The importance of this study is of two field, in the first place, since total oil Nigeria limited is a commercial organization there is a need to know its, organization stock-taking system and how it has helped the efficient of the purchasing records. Therefore, as one of the preparatory actio,ns I used to direct troops to spend some extra hours and get factory and warehouse 5s scores high! Unfortunately, theft and damage can occur– the stocktake will uncover these as discrepancies and allow you to be proactive and responsive to this unfortunate reality in a timely manner, again showing the importance of stocktaking for a business. Simply put, it is the process of physically counting the actual stock you have on your site(s). Whether you are in the hospitality industry, retail, wholesale or manufacturing - you need to have a clear picture of where your business is at. Select Accept cookies to consent to this use or Manage preferences to make your cookie choices. 4. 11/28/2019 - 23:03 . Stocktaking frequency can vary from business to business some prefer once or twice a year while others prefer more frequent counts quarterly or monthly. The Importance of Stocktaking in Hospitality: How To Manage It With HKeeper Highlights. human resource planning stocktaking is important to them. So, you must monitor this type of stock and ensure as much of it is sold before you are forced to sell it at a reduced price. Masters in Supply Chain Management – Top 6 Universities in the U.K. Identify and put into place preventative steps for future preservation of stock, Order replacement stock in good time to prevent loss of custom. with regard to this, Obuseh (2007) noted that to manage materials is to manage the life of an organization that can be successful without adequate management of stocks to have this, there mist be a need for proper stocktaking and verification at the stipulated time. A regular stocktake can be a positive deterrent to staff theft as the knowledge of these regular checks. Maximise stock ordering processStocktaking as previously stated will highlight stock shortages you may not have been aware of and this will prompt you to reorder the products that are selling well. This is only possible by maintaining high standards of 5s in the factory and in the warehouse. Basically, stocktaking is not only important for retail and wholesale businesses, but also for those engaged in other industries such as manufacturing and food … Stock from web and retail sale returns is often overlooked or processed incorrectly resulting in ongoing stock inaccuracies. Stock-taking or "inventory checking" or "wall-to-wall" is the physical verification of the quantities and condition of items held in an inventory or warehouse. For example, if there is a leak in the storage facility/warehouse, you will be able to have this found and fixed at its earliest opportunity so as to prevent further items from the same damage. The size of the discrepancies will be the catalyst for a stock management and security review. I was more interested in weekend work extra overtime being paid! This is the reason why the accuracy of inventory value is subject to all internal and external financial audits, you like it or not! So, there you go, I truly believe that you are doing stocktake at least every year, but now you have more thaa n just financial reason to emphasis the importance of stocking. By not stocktaking regularly your business could be operating at a loss without you knowing. Ensure business targets are achievedIf you identify discrepancies within your stock numbers this will equate to discrepancies in financial figures that are required to hit your business targets. If you have been putting off your first stocktake, or are even thinking if you need one at all, we hope this article will re-motivate you! A stocktake will identify any issues that arise in a loss of stock as well as offer data to conduct your own regular product performance analysis so as to maximise gross profit margins. 1. If the investigation into discrepancies shows there’s a shoplifting issue that is not a ‘one-off’ occurrence, a review of current store security will be necessary. Uncover theft and identify stock shrinkage issuesReality in the retail business is that theft happens and will always impact your stocktake numbers and cause discrepancies. In this blog I will talk about what I believe to be the advantages of carrying out regular stocktake or importance of stocktaking. The policy underscores the importance of gender equality in achieving food security and outlines the gender equality goal, objectives and strategy. What is Stock Taking? Warehouses stock balances counting is one of the most common time killers for many hotels as its a manual and pretty tedious process. We and third parties such as our customers, partners, and service providers use cookies and similar technologies ("cookies") to provide and secure our Services, to understand and improve their performance, and to serve relevant ads (including job ads) on and off LinkedIn. Stocktaking will highlight the opportunist or worse if you have a major issue on your hands. You can monitor through carrying out a stocktake your purchase prices at the time of stocking against the latest purchase prices as you will be able to monitor and track changes in the market and how it will impact your margins. See our, Loss Prevention in Retail – What can you do…, Everything You Need to Know About SKUs but…. Manual counts are prone to error, especially as your company grows. I would love to hear what else you may feel are advantages of carrying out a stocktake that have not been covered here. If you identify discrepancies within your stock numbers this will equate to... 3. And get FREE 2700 Supply Chain Management Terms and Glossary once subscribe. Keep the warehouse tidy. Stocktaking is the process of counting the actual physical stock and checking the numbers against the numbers you have on your books. (adsbygoogle = window.adsbygoogle || []).push({ A1. The importance of taking stock once in a while. The Importance of Stocktaking in Hospitality: Guide for Managers Purpose of Stocktaking. It will also give you an idea if you should be looking at the pricing of your products. WRITTEN by CHRISSY & FILED IN Evaluate ** THIS POST MAY CONTAIN AFFILIATE LINKS, WHICH DON'T COST YOU A PENNY, BUT PAY A COMMISSION TO THIS SITE - LEARN MORE HERE. Supply Chain Risk Management – 5 Cases Which Could Have Happened to You! 5 Reasons why any business needs regular stocktakes. Determine product performanceIt is important to be aware of which products sell and which do not. Stocktaking is the physical counting and verification of items held in store or warehouses. During my days as SCM manager, I used to put all dead and slow-moving inventory in one area of the warehouse to show how much value space dead or slow-moving inventory is occupying. Schedule Your Stocktakes to Reduce Impact on Business Operations. Why is Stocktaking Important? Stocktaking and why you should do one. Another reason to perform stock valuation such retail stocktaking and food & beverage stocktaking is fulfilling legal obligations. Although it will obviously mean that you will be selling at a lower profit margin, it is much better to settle for that than letting the stock sit there taking up valuable warehouse/storage space and reduce inventory. To answer the first question, stocktaking isn’t important for your business, it is essential for it. Inventory is the balance sheet entry as an asset, hence, very important for our accounting and finance friends. Just like I mentioned before, stocktaking is extremely useful to any business that wants to grow. If your business is small or large it pays to complete regular stocktakes – literally! That is essentially the long and short of it! more so, materials or items in stock are life-blood of any organization. The data of the Stocktake will clearly be the most up-to-date check and cross-reference data of what you have to what you should have and what you actually have. A stocktake undertaken regularly will also show problems with damaged stock, unprocessed or missing orders and poor stock control practices. This also works if you have less stock than expected of a product the reason this could be is because it has sold well or is in a good location. 3. In fact, regular stocktaking will help you find new ways to improve your business and increase profits in the long run. A stocktake will put this in focus for you – if you have large numbers of stock of one product that have been on the shelves a while this could be a good indication it is not selling well. Various problems such as overstocking, shrinkage and cash flow can be considerably helped with proper knowledge of your stockholding. Dodge distractions. Save my name, email, and website in this browser for the next time I comment. Now over the years, I have learned lot more advantages of stocking, rather than just financial. Section A: Roles and Responsibilities . General Roles, Responsibilities & Expectation of all Stocktake Personnel These are some of the important advantages to stocktaking. I mostly plan stocktake during weekends. The importance of stocktaking: 5 reasons why any business needs regular stocktakes. Importance of Stocktaking. By conducting a regular stocktake, a damaged stock would have come to light sooner with steps taken to: This advantage alone is enough to fulfill the purpose of stocktaking for any small or large organisation. Inventory Analysis and Supply Chain optimization services included detailed problem solving, technical details & data, knowledge sharing, and detailed summary report. Improving your stocktaking Use a barcode scanner. So, what is a stocktake? google_ad_client: "ca-pub-5161687832945025", A stocktake is a mechanism to make sure that the stock on hand registered or recorded in your books is accurate. Stock valuation has a role to play in the authenticity of your financial statements. The act or process of inventorying merchandise or the supplies on hand.... Stocktaking - definition of stocktaking by The Free Dictionary. Stocktaking is crucial for your business and we will outline everything that proves it. By completing regular stocktakes and having an insight into your stores you will find new ways to increase profits and improve your business. This website uses cookies to improve service and provide tailored ads. Stock taking is the counting of on-hand inventory . Stocktaking on a regular basis enables you to keep a strict control in the everyday running of the business. Although the process of stocktaking will cause a little disruption in the running of the business during the day(s) you conduct it, I believe, it is a minimal sacrifice due to the many advantages it provides. Importance of Stocktaking - 7 Proven Advantages Which Defines the Purpose of Stocktaking Stocktaking: The Ultimate Guide to Creating Your Very Own Customised Stocktake Procedure By Dr. Muddassir Ahmed This ultimate guide of the stocking is a result of 13 years of experience in planning, executing and analyzing annual stocktakes. Variations between your manual stock and your records allow you to pick up on many different issues and enable you to put processes into place to ensure better stock control and management. 1. Do This Self Assessment, The Ultimate Guide to Creating Your Very Own Customised Stocktake Procedure, INVENTORY CARRYING COST – 9 PAINFUL CONTRIBUTORS YOU SHOULD TRACK, 12 Websites to Liquidate Inventory & Make Money from Excess Inventory, How to Develop Traffic Light Inventory Management and Control Report in Excel to Reduce Stock Outs, 7 Rock-Solid Inventory Management KPIs Proven to Control Your Inventory, 18 Targeted Inventory Reduction Strategies for Supply Chain Professionals, Importance of Inventory Management – 14 Awesome Benefits You should know, 21 Authentic Procurement Interview Questions and Answers Guide, Top 23 Supply Chain Interview Questions and Answers Guide, 17 Most Common Procurement Problems and Their Solution, 27 Essential Logistics Interview Questions and Answers, 24 Excel Tips & Tricks to Becoming a Supply Chain Nomad. In general, the keyword when understanding and implementing Stocktaking or Inventory Checking is the word Counting. If a stocktake did not take place, you will naturally assume all your stock is in saleable condition, so when you go to retrieve an item for sale or have a customer request it, you discover at the last moment that you cannot sell it and have to turn the customer away. For more information, see our Cookie Policy. If you do not maintain an importance of stocktaking, you will not know what you have and this will lead to a loss of gross profit not only in the direct sales as expired or obsolete stock may need to be thrown away but also in the cost of warehouse / storage if you are unaware and so this stock is taking up the space you could release for new stock. Also you may have on record that a whole pallet of popular items are available but after the stocktake it is identified that the pallet is damaged in transit, stolen or not delivered. You will be able to identify stock issues and rectify them before they become a big problem, measure how your products are performing, know how many products you have, eliminate theft in your business, discover dead stock, … If you are a specialist business, you may retain your customer and they will wait and return at a later date. Define stocktaking. Do you ever take the time to have a go at taking stock of things in your life? It should be therefore, be identical that the primary responsibility at the impact of stock-taking in an organization with the particular reference to total Nigeria Limited; which deals with the introduction, statement of problems, research question, objectives of the study, significant of the study scope and limitations etc. Stocktaking allows you to keep an accurate track of the physical stock you have, what’s been... Types of Stocktaking. In our previous article, we discussed how to reduce and prevent unnecessary operational costs with HKeeper new feature ‘Highlights’. Pin 0. Businesses are required by law to ensure the full disclosure of their stocks, including their ‘true number’ and value. The importance of stocktaking a warehouse Stocktaking a warehouse involves physically counting all of your stock and matching this to your warehouse inventory system to highlight discrepancies and most importantly, to correct them. You should think the purpose of stocking as one of the key pillars for Inventory Management System that will hopefully grow as your business grows. 5. For me this was one of the key purpose of stocking and substantiate the importance of stocktaking, is to get organised from asset value and physical outlook of goods. Human resource , allows a company to better understand the effect of salary adjustments, bonuses, overtime, and benefits, given employees often account for the highest part of the expense in a company's budget. 2. If you’re like most businesses, you’ll have an inventory tracking … “Advice and counsel from more senior leaders, who are willing to share their insightful sharing of experiences and gives you career guidance and growth tips”. In last 13 years, I have been conducting stocktaking every year. Best Warehouse Assessment & Improvement Tool. The accuracy and regular process of stock-take will help with making an informed, data-backed decision to invest in the right products, as it will show you which products are selling and which are not and therefore what to invest in. IMPORTANT OF STOCKTAKING AND VERIFICATION IN GOVERNMENT STORES CHAPTER ONEINTRODUCTIONIt is not exaggeration to say that stocktaking and verification is an important exercise in which every organization out write to be successful must embark on. Well no, but I think you have gathered by now, that it’s a little more than that! }); Thanks for this wonderful information, mostly the importance of stocking…am looking forward to read the ultimate guide to creating your very own customized stock take procedure, Hi- you can download Stocktaking: The Ultimate Guide (Stocktaking Procedure) from here http://www.scmdojo.com/guide/stocktaking-procedure/. The importance of stocktaking in your business If you are a stock-based business, the importance of doing a stocktake is paramount. Many New Zealand schools have to account annually for their library resources. Stocks refer to finished products sold by a business to generate revenue. Whether you operate a small, medium, or large-scale business, regular stocktaking comes with many benefits. You will also be able to see if there is a dead stock that you should think about possible flash sales to shift the stock. enable_page_level_ads: true However, this is a rare occurrence, chances are you will lose that custom as the customer will most likely go elsewhere. The Importance of Stocktaking In case you are wondering why you should stocktake, you have come to the right place. The goal of my keynotes is to motivate through inspiration and stories of transformation, with liberal doses of education. That way, you can minimise the ordering of such products and save a lot of money in the long run. Please refer to my The Ultimate Guide to Creating Your Very Own Customised Stocktake Procedure for your step-by-step guide to developing your very own Stocktaking Procedure for your business. It is much better to find these anomalies sooner rather than at the end of a financial year and you do not have time to put a plan together. Yes, you really can increase profit margin by getting a realistic view of what you have, what is selling and if things are going wrong to capture them at the earliest opportunity. 2. In cases where component materials are sold, these are also counted as stocks. A reappraisal of a situation, a person, or one's own position or prospects. Apart from your business address, sites can also include any storage or warehouse facility you may own or are renting. Andwe have only 48 hours to get the whole thing done! Strengthen your pricing strategies A stocktake will put your finances into the spotlight. Let us convince you that stocktaking is integral to any business. To gain better understanding read my article “Importance of Stocktaking – 7 Proven Advantages Which Defines the Purpose of Stocktaking for Your Business” Table of Content from Stocktaking Procedure. Stocktake is the physical counting of all stock and matching it against the stock numbers you have recorded in your books/software. Signup for latest blogs and special offers! It is an ideal time to revise pricing strategies to enable you to maximise profits. This may be done to provide an audit of existing stock. Try to find a time that works for you and your staff that won’t hurt your bottom line or create unnecessary distractions. Uncover theft and identify stock shrinkage issues. Importance of stocktaking and how it can help retail processes. It may be that there are certain times in the years when the purchase prices rises and so will be able to make a calculated decision based on your sales report generated from the stocktake if it would be worth making an earlier investment than originally planned. [Revised & Updated]. Ensure business targets are achieved. It is also the source of stock discrepancy information. Stocktaking is an important business practice and the sooner you realize this, the better it will be for you. Looking for a way to work with me and promote your business, service or product? This means identifying every item on hand, counting it and summarizing these quantities by item. Here’s our list of 10 fundamental steps that you should include in your stocktaking process for maximum effectiveness. The data you will be collecting and updating as a key purpose of stocktaking has a direct financial impact has ‘asset gain’ or ‘asset loss’ (also known as shrinkage). The Why and How of Warehouse Safety – 14 Categories, Which is The Best Supply Chain Management Book? Stocktaking: The Ultimate Guide to Creating Your Very Own Customised Stocktake Procedure, How to Run a S&OP Process – Benefits, Steps & Barriers, Materials Management Competency Assessment, S&OP Maturity Model – How Good is your S&OP? Sometimes, however organised we are, things can overwhelm us, and taking stock is … Considering importance of stocking, it was fixed a year ago! Even more regrettable is the fact that staff can be to blame for these thefts, regular stocktaking can discourage some employees from stealing. You can change your cookie choices and withdraw your consent in your settings at any time. The frequency of stocktaking performance depends on how much control you want to have over your business and when would you prefer finding out about your losses. Stocktaking allows you to monitor stock shrinkage, identify security vulnerabilities, spot theft hot spots and closely monitor high value items. One of the most important benefits of regular stocktaking is that you will get to learn about the slow-moving items in your warehouse.
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