Understanding How Cycle Counting Improves Warehouse Inventory Accuracy

August 22, 2019

Inventory physicals and inspections are a dreaded part of warehouse management. It is during these events that the accuracy of the inventory management is thoroughly analysed to discover if improvement is needed. They slow down normal operations, tie up labour and may even require overtime wages. As a result, profits can decrease during their occurrences and must be recouped afterwards as quickly as possible. Even in the most sophisticated of warehouse operations, the accuracy of the inventory tracking and count is an ongoing challenge all throughout the year. With this complex economy today, warehouses are breathing, living organisms that require continual care and proper attention. Inventory process must be interwoven with all order fulfilment tasks, including shipping. The answer to this challenge is cycle counting, and we provide the following fact to help you understand how it can help you improve your warehouse inventory accuracy.

Definition of Cycle Counting

Cycle counting is when you periodically count your warehouse inventory to verify that the physical amount in the bin locations corresponds with the count recorded in your warehouse management system. The thought behind this is that by counting only a small percentage of goods at multiple times during the year that you will gain a better overall accuracy. Also, you will be able to catch errors more quickly. Another purpose of this practice is to keep labour costs to a minimum.

How Cycle Counting Works

This process can vary from warehouse to warehouse. You can come up with your own schedule and methods to count the chosen merchandise on any given cycle-counting period. In addition to regular products, you may wish to include the peak or seasonal items as well. Once you select the products for inspection, the employees follow detailed instructions on mobile devices on how to execute their duties. During the process, real-time facts are transmitted to the proper management personnel, who may request recounts if necessary. The adjustments to the inventory figures also can be made at the same time when needed.

Ways That Cycle Counting Increases Inventory Accuracy

1. Eliminates the need for physicals

2. Utilises employees more efficiently

3. Higher order fulfilment rates that do away with lost sales and back orders

4. Helps to identify the sources of inventory inaccuracies

5. Leads to improvement in your purchasing practices with stock to prevent overages or shortages

6. Increases your inventory accuracy up to 99.99 percent from its current level

For further fact about how cycle counting improves warehouse inventory accuracy, consult with Challenge Packaging and Warehousing Solutions. We specialise in a wide assortment of services that help businesses address their distribution operations accurately and efficiently.

Contact Us

Address: Unit 3, 8 Weddel Court Laverton North,
Vic 3026

Telephone: (03) 83609736
Fax: (03) 83609738
Email: info@cpacks.com.au

Optimized by NetwizardSEO.com.au