The Differences Between Stocktakes and Cycle Counts

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Neglecting inventory tracking will set you up for things like delayed orders, unhappy customers and false inventory reports. However, accurately keeping track of your inventory can greatly enhance your chances of success. There are two primary methods for doing so ā€“ namely, cycle counts and stocktakes ā€“ and this article explores both.


Most business owners will have heard of stocktakes and hopefully, will have done one or two of these themselves. Stocktaking is the simple task of counting the amount of stock the business holds, the types of stock, their condition and their whereabouts (i.e. warehouse, production etc).

Businesses usually carry out stocktakes on a yearly basis, and these help business owners and staff to collect and examine yearly data on inventory variances.

Since yearly stocktakes can mean counting and tracing large volumes of stock, this type of inventory tracking is generally quite time-consuming and labour intensive, requiring a generous amount of business downtime.

Cycle Counts

Cycle counts is a process whereby business owners or their staff attempt to count the stock held by the business. However, as the name entails, the regularity of these stock counts are cyclical and usually occur weekly.

The aim of cycle counts is the same as the yearly stocktake, that is, to track and trace inventories and to record any variances. However, the method with which the cycle count is carried out is vastly different.

Cycle counts are generally carried out much more frequently than stock counts, and they do not generally count the entire inventory held by the business. Rather, cycle counts work by counting a number of items in a number of areas within the company warehouse(s) without having to count the entire inventory.

To save time, this sampling technique only counts a certain number of items in the warehouse, and from this infers the count for the whole inventory.

It is important that business owners take a yearly stocktake, but it is ideal if a cycle count is also carried out regularly. By carrying out a cycle count weekly, business owners will have a better chance of holding accurate information about their inventories, and this will help to improve productivity and efficiency.

Downloading Inventory Software for Stock and Cycle Counts

As small businesses begin to expand, taking both yearly and cyclical stocktakes can become more and more challenging. The bigger the demand, the more stock you will need, and the more you will have to track and count.

A great way to track, trace and count your stock is by downloading stocktaking software. While new, smaller businesses may find it easy enough to conduct stock and cyclical counts manually, as your company expands you will find this more and more difficult.

By downloading inventory software, you will have all the details about your inventory at your fingertips. Good quality inventory software will also allow for inventory tracking in real-time, from the raw materials stage to production and then delivery to the customersā€™ door.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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