Inventory Control Basics: Keep Stock Accurate and Costs Low

Ever wonder why some businesses always have the right products on hand while others constantly run out or sit on piles of dead stock? The secret is solid inventory control. It’s simply the process of watching what you have, what you need, and when you need it, so you can cut waste, keep customers happy, and protect your profit margin.

Key Inventory Control Methods

There are two main ways to count inventory. The periodic method checks stock levels at set times—like a monthly physical count. It’s cheap but can leave gaps between counts. The perpetual method updates inventory in real time, usually through barcodes, RFID tags, or a warehouse management system (WMS). When a product moves, the system records it instantly, so you always know the exact balance.

Most businesses start with a basic spreadsheet and move to a WMS as they grow. A spreadsheet works for a few SKUs, but a WMS handles dozens of locations, batch numbers, and expiration dates without headaches. Look for a system that integrates with your accounting or ERP so buying, selling, and stock data stay in sync.

Practical Tips to Improve Accuracy

1. **ABC analysis** – Split items into three groups. ‘A’ items are high‑value or fast‑moving, ‘B’ are moderate, and ‘C’ are low‑value or slow‑moving. Focus your counting effort on ‘A’ items to catch costly mistakes early.

2. **Cycle counting** – Instead of a big yearly count, pick a few items each week and count them. Over a year you’ll have counted everything, but you’ll also catch errors sooner.

3. **Set reorder points** – Use past sales data to decide the minimum quantity you should keep on hand. When stock drops to that level, the system can trigger a purchase order automatically.

4. **Standardize receiving** – When new stock arrives, scan it straight into the system and place it in a designated spot. This prevents “unknown” inventory that sits in a backroom and never gets recorded.

5. **Train your team** – Make sure everyone knows how to scan, where to store items, and why accuracy matters. A quick refresher session each quarter can keep mistakes low.

Technology can make these steps easier. Handheld barcode scanners connect to your WMS, giving instant updates. RFID tags can even track pallets without manual scans. If you’re on a tight budget, a low‑cost Android app that reads barcodes into a Google Sheet can be a good starter.

Finally, review your data regularly. Look for trends like items that never sell or products that are always out of stock. Adjust your buying habits, renegotiate with suppliers, or run promotions to move slow‑moving stock. The more you act on the information, the tighter your inventory control becomes.

Good inventory control isn’t a one‑time project—it’s an ongoing habit. By using simple methods, relying on the right tools, and keeping the whole team in the loop, you’ll keep shelves stocked the right way, cut unnecessary costs, and give customers the reliability they expect.