Topical Training Tip

For many stores, physical inventory will take place at the end of June. With that in mind, I have planned two on-line web-training classes on Inventory. These sessions will be held on June 5th and June 17th. Both sessions will begin at 11:00 AM Pacific time. This class will review the preparation and procedure for a conducting a successful inventory. If you would like to join in on one of these sessions, please contact me via email deborah@sequoiap.com and I will send you an on-line invitation.

Remember the key to a successful inventory is preparation and following the correct system procedure. Below I have listed an Inventory In Nine Steps outline. I would recommend that this list be reviewed and followed throughout the inventory process.

Inventory In Nine Steps

1. Prepare Your Store

2. Clear Old Inventory Data

This step clears the numbers from the last inventory, making way for the new numbers being entered on this inventory.

• Report Type>Shelf Verification>Physical Count
• Report must be in Z-Reset mode
• Run option? is most likely Run only (no need to print old, invalid data)
• Sort option? should be set to location
• Sort list must be * to remove all data

3. Freeze Current Inventory

This step saves the current On-Hand count for each item, giving the system a number to compare the new count to.

• Main Menu>Inventory>Freeze Qty. On Hand
• Level? will most likely be class (item is used to freeze only specific item records)
• Reset Order/Return Information? is set to No unless items are being removed from store.
• Delete Adjustment History? should be left as No unless items are being removed from store.
• Sort list is set to * if the entire store is being counted.
• If only selected items are going to be counted, a list of Classes should be entered. Classes are separated by commas for individual classes or dashes for a range of classes.
• Sort list requires these special considerations:
  • For Textbooks, Trade Books or GM cycle counts, be sure to include only those classes that apply.
  • All upcoming inventory processes will be based on the same classes set in the sort list including:
    • Physical counts
    • Adding not counted items
    • Posting of counts
    • Printing an accurate inventory value

4. Physical Counting

• With Palms:
  • Scan items
    • Change locations when necessary.
• With Symbol PDT?#8364;™s:
  • Scan items and download them as batches through the device cradle.
    • Change locations and download periodically
• By Hand:
  • Print Inventory Worksheet
  • Inventory>Valuation Report>Worksheet
  • Make all entries through:
  • Main Menu>Inventory>Manual Shelf Count Entry for Item
• 3rd Party Company:
  • Enjoy watching others work and wait for a diskette of scanned results.
  • Locations typically refer to fixtures or shelf numbers.
  • Location is only used to audit counts.

5. Add Not Counted Items

This step identifies items that were not counted during the current inventory. If the item had a count before inventory was frozen, but was not counted, it will be added with zero count to the verification database, in section NOCOUNT with the user name notfound.

• Main Menu >Inventory>Add Not Counted Items to Verification File
• Level? will most likely be Class
• As noted previously: freezing, adding no counts, posting inventory and printing values will typically be done at the same level.
• Range is set to * if the entire store is being counted.
• If only selected items are going to be counted a list of Classes should be entered. Classes are separated by commas for individual classes or dashes for a range of classes.

6. Audit Physical Counts

This step creates a report that lists inventory discrepancies. Discrepancies are items where the number that was frozen (current on hand) and the amount that was counted do not match.

• Report Type>Shelf Verification>Stock Comparison
• Mode? must be X-Read to preserve data
• List option? may be set to Each to only view individual item comparisons.
• Run option? will likely be Run & Print to post counts on fixtures
• Valuation & Discrepancies only will typically be set to No to audit counts.
• Post Counts? must be set to No (adjustments still need to be made)
• Compare to? must be set to Previously Frozen On Hand
• Sort Option? will most likely be Class or Location/Time
  • Class is used if you are looking at all scanned items
  • Location/Time is best used to view particular fixtures individually
• Sort List is that Class or Location that you wish to audit.
  • Locations should be entered one at a time to insure one printed page per location
• Users typically print one page for every location that was recorded during advanced planning.

7. Work Discrepancies

This step reconciles the identified inventory discrepancies.

Inventory discrepancies can be caused by multiple factors:

• Items improperly tagged
• Items in multiple locations
• Receiving not done correctly
• Customers administering 100% discounts
• Display case overlooked
• Incorrect barcode scanned
• Improper receipt of multi-store transfer
• Merchandise written off but not removed from system

Adjustments may be done in different ways:

• Scan an item with the Palm and enter a positive or negative adjustment amount.
• Scan an item with a Symbol batch terminal and enter a positive or negative adjustment amount.
• Make a manual adjustment through Main Menu>Inventory>Manual Shelf Count Entry for Item
• Make sure to use correct data locations
• Reprint audit report, Stock Comparison Report as described in Step #6
• Repeat this step as needed

8. Post accurate counts

When you are satisfied that the counted inventory is correct, you can now post this inventory to your database. Posting this inventory will also replace the counts in any of the following software modules you have installed:

• Textbook Partner
• Trade Book Partner

These packages will be updated by the difference in inventory as determined by the physical count:

• Stock Ledger
• Accounting General Ledger (if using cost-based accounting)

Do not post inventory until you are satisfied that the numbers are correct. All inventory adjustments need to be made prior to posting.

• Report Type>Shelf Verification>Stock Comparison
  This is the same report that was run in Step #6 but with a different set of criteria.
• Mode? must be X-Read to preserve data
• List option? should be set to Each & Total to update all records
• Run option? will likely be Run to post counts with reprinting all data
• Valuation & Discrepancies only will typically be set to No to post counts.
• Post Counts? must be set to Replace on Hand
• Compare to? must be set to Previously Frozen on Hand
• Sort Option? will likely be Class because we want to post at the same level inventory was frozen. (DO NOT post by location, as the system will not have a cumulative total, just the last location processed)
• Sort List is that class or those classes that were frozen when the process began.

After Posting:

• Individual item On Hand counts have become the posted number.
• Physical Count File contains actual counts recorded by scanners adjusted bases on audit counts.
• Freeze File contains the inventory as it existed prior to counting.

9. Calculate the Value of Inventory

This step generates a report that lists all items in the system with their assigned value.

• Report Type>Inventory>Valuation
• List option? is set to Each & Total to get item data summaries by Class.
• Run option? will likely be Run & Print to provide a hardcopy of the report.
• Zero skip? is set to Yes to avoid printing all items that were not counted.
• Worksheet? is set to No since you have just completed a physical count.
• Value? Is normally set to Cost and Retail for the most complete information.
• Sort option? is Class to be consistent with freezing and posting.
• Sort list should match the values in freezing and posting.

More Inventory Information

• QA1598 't Inventory Checklist
• QA1619 't Inventory Guidelines
• QA1290 't How do I create an inventory verification file for RGIS or WIS?
• QA1607 't How can RGIS or WIS or another inventory company send us inventory counts?
• QA1652 't PDT 3100 Usage Instructions
• QA1190 't How does the POS system interact with Textbook Partner?