Inventory Count. The majority of manufacturers and distributors cringe at the thought of a full physical inventory count. Owners think about the resources needed to prepare and perform the inventory count. Team members think about the tedious task of finding, organizing and counting all the inventory items. However, an inventory count is vital to a growing and successful manufacturer or distributor.

The reality is that a manufacturer or distributor will at some point perform a full physical inventory count. The inventory count can be a good team-building event with accurate information or it can turn out quite the opposite. Do not fall into the trap of a poorly planned and executed inventory count, as it directly impacts your bottom-line profits.

Here are Ten steps for a successful inventory count:

1. Contact the vendors - Plan with vendors to minimize orders and reduce the number of logistic movements into the warehouse the week prior to the inventory count.



2. Determine the date and time - Set a date and time during the weekend for the inventory count at least 4 weeks in advance. Do not perform the inventory count right before or after business hours because team members tend to rush the process and obtain inaccurate information.



3. Develop the count tracking methods - Generate count cards or sheets. Remember to include spaces for names and signatures of the team members for future accountability and tracking.



4. Establish the teams - Divide the team members into two-person teams focused on specific geographical areas within the warehouse. It is a good idea to partner senior team members with new team members to train them on the inventory items and in the inventory count process.



5. Clean up the warehouse - Remove all trash and liquidate unnecessary inventory items based on the ABC. Label all warehouse locations, isles, shelves and bins.



6. Count the slow-moving items - Count the slow-moving items one day prior to the inventory count.



7. Fulfill all the sales orders - Fulfill all outstanding sales orders to reduce the amount of inventory left to count in the warehouse.



8. Stop the receiving - Do not receive inventory during the inventory count day. Leave non-received inventory in the receiving area to avoid confusion between the counts, sheets and system.



9. Audit the counts - Audit the counts based on ABC. Ask team members to recount the inventory items if there are more than 5% errors. Document discrepancies by positive or negative numbers from the system rather than the actual counts, allowing time for research while the company goes back to do business.



10. Review the results - Share the results with the team. Ask the team members for feedback on the inventory count process and how it can be improved for next time.