In short
- 01Split the store into zones and give each zone to one counter, so nothing is counted twice and nothing is missed.
- 02Uncounted is not zero. A shelf nobody counted must stay open, not be posted as empty.
- 03Rank differences by value, not by units. Twelve missing cans matter less than six missing tins of baby formula.
- 04Recount the biggest differences before you post anything, then post adjustments with a reason and a name.
- 05Count little and often (cycle counts) between full counts, so problems surface in weeks, not at year end.
On this page
- In short
- What is a stock count, and why does it matter?
- Full count or cycle count: which do you need?
- How do you plan a team stock count?
- How should counters work during the count?
- Worked example: valuing the differences
- What should you do after the count?
- How do team stock counts work in Momentum?
- Questions people ask
To run a stock count with a team, divide the location into zones, assign each zone to one counter, and have everyone count at the same time against a frozen snapshot of the expected stock, recording by batch where it matters. Then compare counts with the system, value each difference at cost, recount the largest ones, and post the adjustments with a reason and the counter's name. Done this way, a count gives you an accurate stock figure and also shows where stock is going missing.
What is a stock count, and why does it matter?
A stock count (or stocktake) is a physical count of the units you hold, compared with what your system says you should hold. The difference is your variance. When the count is lower than the record, that loss is called shrink.
Average shrink rate reported by US retailers for fiscal 2022, up from 1.4% the year before: about $112.1 billion in losses.
Source: NRF National Retail Security Survey 2023You can't see shrink without counting. A system figure that is never checked slowly drifts from the shelf. Then reorders go wrong, transfers go wrong, and the balance sheet overstates your stock.
Full count or cycle count: which do you need?
Most businesses need both. They answer different questions.
- Full count
- Every item in the location, at once
- Cycle count
- A slice: a zone, a category or the highest-value items
- Full count
- Once or twice a year, or when you take over a store
- Cycle count
- Weekly or monthly, on a rotation
- Full count
- High: usually after hours or a closed day
- Cycle count
- Low: can run during trading
- Full count
- Year-end stock value, resetting a store you don't trust
- Cycle count
- Catching problems early, keeping high-risk items accurate
| Full count | Cycle count | |
|---|---|---|
| What | Every item in the location, at once | A slice: a zone, a category or the highest-value items |
| How often | Once or twice a year, or when you take over a store | Weekly or monthly, on a rotation |
| Disruption | High: usually after hours or a closed day | Low: can run during trading |
| Best for | Year-end stock value, resetting a store you don't trust | Catching problems early, keeping high-risk items accurate |
How do you plan a team stock count?
Most count errors are decided before the first item is scanned. Work through this list the week before:
- 1Finish open paperwork. Receive pending deliveries, complete transfers in transit, and post returns. Stock that is half-moved gets counted twice or not at all.
- 2Draw zones. Split the floor and stockroom into zones: aisles, bays, shelves, the back room, the cold room. Name them the same way they are labelled on the floor.
- 3Assign one counter per zone. Put names against zones. If the store is large, pair a slow, careful counter with a fast one on alternate zones, not the same zone.
- 4Decide how you handle sales during the count. Either close, or count a zone quickly and let sales continue, so the system can account for what sold while you counted.
- 5Prepare the tools. Charged scanners or phones, labels reprinted for items with damaged barcodes, and a rule for loose and opened packs.
How should counters work during the count?
- Count, don't estimate. Open cartons that look full. A sealed case of 24 with 20 inside is a common source of phantom stock.
- Count by batch where dates matter. In a pharmacy or grocer, record each batch and expiry separately so the expiry reports stay right after the count.
- Uncounted is not zero. If a zone isn't finished, it stays open. Posting it as empty writes off stock that is still on the shelf.
- Don't correct the system on the fly. Counters record what they see; differences are reviewed afterwards, by someone else.
- Flag, don't fix, what looks wrong. A product in the wrong zone, a damaged unit or an unlabelled item gets a note, not a guess.
Worked example: valuing the differences
Five lines from a pharmacy's count. By units, the energy drinks look like the biggest problem. By value, the baby formula is nearly eight times worse, which makes it the one to recount first and investigate.
- System
- 140
- Counted
- 132
- Difference
- −8
- Unit cost
- $1.20
- Value
- −$9.60
- System
- 36
- Counted
- 30
- Difference
- −6
- Unit cost
- $18.50
- Value
- −$111.00
- System
- 90
- Counted
- 94
- Difference
- +4
- Unit cost
- $2.25
- Value
- +$9.00
- System
- 55
- Counted
- 49
- Difference
- −6
- Unit cost
- $4.10
- Value
- −$24.60
- System
- 240
- Counted
- 228
- Difference
- −12
- Unit cost
- $0.95
- Value
- −$11.40
- System
- 561
- Counted
- 533
- Difference
- −28
- Value
- −$147.60
| Item | System | Counted | Difference | Unit cost | Value |
|---|---|---|---|---|---|
| Paracetamol 500 mg, 24 tablets | 140 | 132 | −8 | $1.20 | −$9.60 |
| Baby formula 800 g | 36 | 30 | −6 | $18.50 | −$111.00 |
| AA batteries, 4-pack | 90 | 94 | +4 | $2.25 | +$9.00 |
| Shampoo 400 ml | 55 | 49 | −6 | $4.10 | −$24.60 |
| Energy drink 250 ml | 240 | 228 | −12 | $0.95 | −$11.40 |
| Net | 561 | 533 | −28 | −$147.60 |
The surplus batteries matter too. A gain usually means a receiving or transfer error elsewhere, and it often explains a loss on a neighbouring line.
What should you do after the count?
- 1Recount the top differences by value, with a different person, before posting anything.
- 2Check the paperwork for the lines that still differ: recent receipts, transfers, returns and refunds.
- 3Post the adjustments with a reason (damaged, expired, theft suspected, count error) and the name of who approved them. The ledger records the value.
- 4Look for patterns across counts: the same category, the same zone, the same supplier. One count is a number; three counts are evidence.
- 5Schedule cycle counts for the items and zones that produced the biggest differences.
How do team stock counts work in Momentum?
Momentum by Ltiora lets several people count one location at the same time. Each person's counts are recorded under their name, the differences are valued at cost using your costing method, and the adjustments post to the books when the count is submitted. Storage places (aisles, bays, shelves) let you split the location into zones that match the floor.
Afterwards, the Stock Count Discrepancy, Stock Count History and Shrinkage Comparison reports show which items, locations and counts produced the losses. Every adjustment is written to a hash-chained audit trail, so a posted count can't be quietly edited later. The optional Momentum AI stock count check can flag counts that look unlikely before they are posted; it only flags them, and a person decides.
Questions people ask
How often should a retailer count stock?
A full count once or twice a year, plus rolling cycle counts. Count high-value and high-theft items monthly or even weekly, and slow, low-value items once or twice a year.
Do we have to close the store for a stock count?
For a full count, most stores count after hours or on a closed day. Cycle counts of one zone or category can run during trading, as long as the system can account for sales made while the zone was being counted.
Should two people count the same shelf?
Not as a default: it doubles the work and people tend to agree with the first count. Count once, then recount only the lines with the biggest differences by value, using a different person.
What is an acceptable stock count variance?
There is no universal number. Track your own net variance as a share of stock value and of sales over several counts, and act on the trend and on the largest lines by value.
A good stock count is planned, split into zones and reviewed by value. Plan the zones, let people count in parallel, keep unfinished zones open, and review the differences in dollars. Post every adjustment with a reason and a name, and the count gives you a list of losses you can act on as well as a stock figure.
Sources
Count a location with your whole team
In a demo we'll set up zones for one of your stores in Momentum, count it with two people at once, and show the differences valued and ready to post.
