Stocktaking is an important part of all businesses, and it is especially essential for startups and small businesses. It enables new business owners to ensure that the firm is performing as per expectations, and it makes sure the business is receiving the projected profit.
As a year of business comes to the end, it is advisable for a startup business to reflect on the past year’s earnings, as it will help the business owner gear up for the following year and achieve better results. This invariably means taking stock of the previous year, reviewing the market position of the business and preparing a checklist for starting the next year’s business plan.
A thorough year-end review can immensely benefit the small business owner in positioning the business for financial recovery. Below are some ways and tactics, which can help you take stock of your business at the end.
1. Review the stocks: Determine the stock level and the value of the stock in the inventory. Make a checklist of all the products, which are fast selling and those that are slow moving. Based on which, you can enhance your inventory for the following year.
2. Keeping count:the stock needs to be manually counted rather than just estimated. This is a tiresome process but it will surely help you take stock of your business and it reduces the chances of theft and other malpractices in the firm. In addition, rechecking the written records with the physical stock will help in keeping accurate stock records.
3. Stock control: based on the review of stocks, identify the stock that is fast moving, and keep them stacked up for your customers. Determining the volume sales per stock item will help you decide what to buy for your inventory. Buy stock from the suppliers that will fetch you profit in a reasonable period of time and avoid buying in bulk, unless there is a requirement.
4. Storage: Ensure that your storage room is organized and tidy. Otherwise, the chances of write-offs will increase leading to loss of inventory. Here are some basic tools, which can help you in taking stock.
1. Stock sheets: Updating stock sheets on a regular basis will help in keeping track of the quantity of the stock, batch number and expiry date, if any, of the products. This will ease the process of stock taking at the end of the year.
2. Write-off sheets: These sheets help in keeping track of the inventory, making sure that the bad stock is written-off.
3. Scanners: If your stock is bar-coded, it is best to buy a hand-held scanner. This is the easiest way to keep track of the inventory and helps in stocktaking.
4. Pens: Use different colored pens to differentiate between audits.
5. Clipboards: They help in keeping the papers organized. Clipboards are handy, they keep all important papers together and also saves time.
6. Calculators: Use a simple calculator to determine the value, to calculate profit and loss and to verify other numerical facts, which can otherwise go wrong with manual calculation.