Step 1
Keep product identities and units consistent
A product name can change, but its identifier should remain dependable. Distinguish variants such as size or color when you need separate stock counts. Define whether you track an item by piece, carton, kilogram or another unit.
- Assign a stable SKU to every separately stocked item.
- Define its stock unit and any conversion rules.
- Use the same identifier on purchase, delivery and billing records.
Step 2
Record every quantity-changing event
Receipts increase stock; dispatches decrease it. Returns, damage and corrections need their own documented movements. A transfer moves stock between locations and should not be treated as a new supplier purchase.
- Capture a date, location, quantity and reference for each movement.
- Link receipts and dispatches to source documents.
- Give adjustments a reason and retain the supporting record.
Step 3
Reconcile records with physical stock
Compare recorded quantities with a count taken at a defined time. Investigate missed receipts, wrong units or unrecorded dispatches before posting a correction. Keep the old quantity and the reason for the change visible in your records.
- Set a count cut-off and control movements during the count.
- Recount unexpected differences.
- Approve corrections and review repeated causes.
Worked example
Example: explain the closing quantity
Opening stock of 50 plus receipts of 20 minus dispatches of 15 minus damage of 2 leaves 53 units. A physical count of 51 indicates a difference of −2 that should be investigated before adjustment.
Illustrative example; use your own transaction data.
Frequently asked questions
Is available stock the same as physical stock?
Not always. Physical stock is what you hold; available stock may exclude reserved or otherwise unavailable quantities. Define which measure your order workflow uses.
Why does a transfer need two location records?
A transfer reduces the source location and increases the destination when received. Recording both makes it possible to reconcile stock at each location and identify goods in transit.