Warehouse Preparation for an Accurate Inventory Count

warehouse preparation

The accuracy of your warehouse inventory count hinges significantly on the layout of your inventory and the level of organization within your space. A well-prepared warehouse dramatically improves the reliability of your count. The integrity of the process is largely determined by several key factors, including careful planning and execution.

Planning Your Inventory Count – Key Questions to Answer

Before beginning, address these critical questions to ensure a smooth and accurate count:

  • Timing: When is the warehouse inventory count scheduled to be completed?
  • Scope: Is it a full or partial count of the warehouse?
  • Duration: How long do you estimate it will take to complete the entire warehouse inventory count?
  • Data Entry: How long do you estimate it will take to input the count quantities and their corresponding locations?
  • Operational Status: Will the business or warehouse be open, closed, or operating over a weekend, overnight, holiday, or requiring a shutdown specifically for this purpose?
  • Staffing: What staff will be available to perform the count and accurately complete the data entry?
  • Distribution: Who specifically will be in control of the distribution of count sheets or tags to ensure consistent application?
  • Variance Handling: Will variance analysis be required before or after the warehouse inventory count is completed?

Preparing the Warehouse Environment

The following steps are crucial for effective warehouse preparation:

  • General Housekeeping: The warehouse should be tidied to allow for easy access and clear passageways, particularly when counting stacked inventory items.
  • Inventory Consolidation: Where possible, consolidate types of inventory into a single location to simplify the counting process.
  • Logical Organization: Organize count areas logically, using methods such as bin location, product code, SKU (Stock Keeping Unit), or supplier’s product code, depending on your operational needs.
  • Clear Labeling: Inventory must be clearly labeled to facilitate easy identification by the staff performing the count.
  • Inventory Removal: Remove any inventory not being counted – this includes items awaiting return to the supplier or those designated for disposal.

Considering Inventory Movement and External Factors

  • Inventory Movement Restrictions: Minimize inventory movement during the count process to avoid inaccuracies.
  • Consignment Inventory Management: Carefully consider consignment inventory:
    • Are there items consigned out to customers?
    • Are there items consigned to you from suppliers?
    • Is there consignment inventory being shipped to stores?
    • A robust system must be established to identify and report on these inventory items.

Verification and Confirmation

  • Visual Checks: Conduct regular visual checks of the warehouse sections to confirm that all inventory has been accounted for.

Important Note: Accurate inventory counts require meticulous attention to detail and a systematic approach. Proper warehouse preparation is a cornerstone of a successful inventory count.

View and Download PDF