Stock taking vs stock checking is a question of scope. A stock take counts everything you hold, usually once or twice a year, while a stock check counts a few chosen lines, often every week. The stock check finds problems while they are small, and the stock take proves the total for your accounts.
One common mix-up needs clearing first. Stock checking does not mean watching levels to know when to reorder. That job is stock control, done with an alert quantity on each product and a reorder list.
What is the difference between stock taking and stock checking?
A stock take is a full count of every item in every location; a stock check is a partial count of a few lines. Cambridge Dictionary defines stocktaking as "the counting of all the goods, materials, etc. kept in a place such as a shop". In American usage the same job is usually called a physical inventory, a difference explained in inventory vs stock.
| Stock take | Stock check | |
|---|---|---|
| What is counted | Every item, in every location | A few lines: valuable, fast-moving or suspect |
| How often | Once or twice a year, or monthly by category | Weekly, or daily for the riskiest lines |
| Shop open? | Usually counted before opening or after closing | Open: one shelf between customers |
| Who counts | The whole team, in pairs | One or two people |
| What it answers | What the stock is worth today, for the accounts | Whether this line is right, and why not |
| Other names | Stocktake, physical inventory, wall-to-wall count | Spot check, cycle count |
A shop needs both. Checks alone never prove the total, and a yearly take alone finds a loss months after it started.
How often should a small shop count its stock?
Count more often whatever carries one of four risks. A line is risky if it is valuable, easy to pocket, close to expiry, or sold in broken units such as pieces from a carton. The schedule below is a starting point built on those four risks; adjust it after two or three counts show where your differences are.
| Shop | Stock check | Full stock take |
|---|---|---|
| Pharmacy or drug shop | Weekly: high-value lines and anything expiring within 90 days | Quarterly |
| Supermarket or general shop | Weekly: 10 to 20 fast lines such as sugar, cooking oil and soap | One category a month; everything once a year |
| Hardware | Monthly, one category at a time | Yearly |
| Phones and electronics | Daily: every unit, by serial or IMEI number | Monthly |
| Clothing boutique | Weekly: the most expensive pieces | Quarterly |
To choose which lines to check, rank them by value first; the 80/20 rule in inventory shows how. A full count at your financial year end gives the closing stock figure your accounts need.
How to do a stock take in seven steps
- Set a cut-off. Record every sale, delivery and transfer first, then count before opening or after closing. Deliveries that arrive during the count wait until it is done.
- Print a sheet per shelf or category, so each pair of counters owns one area.
- Count blind. Hide the system's quantity column before printing, or counters copy it instead of counting.
- Count in pairs: one person counts, the other writes. Nobody counts only the stock they are responsible for.
- Count in the selling unit. Turn opened cartons into pieces on the sheet, and write full cartons as pieces too.
- Set aside damaged and expired goods. Record them as damages, not as a counting difference, so the loss keeps its reason.
- Recount the big differences, then adjust. A second person recounts any line that is far out before anyone changes the records.
For example, a shop in South Africa buys bar soap in cartons of 24, and its system holds 288 bars. The count finds 11 full cartons and 17 loose bars: 281 bars. The shelf is 7 bars short, which at R10 each at cost is R70.
The adjustment is a subtraction of 7, not an entry of 281. In ArmPOS, Qty is how much to add or remove, so a subtraction of 281 would leave just 7 bars on record.
Value the counted stock at cost to get the closing figure. IAS 2, the international standard for inventories, measures it at the lower of cost and net realisable value. Stock that will sell below cost is written down.
The year-end routine in full is in how to do a year-end inventory count.
How to do a stock check in 15 minutes
Pick ten lines, count them, compare with the records, and explain each difference before you touch the stock figure. Rotate the list each week, but keep your most valuable and most-stolen lines on it every time.
Many differences have a reason that is not loss. Rule these out first:
- a sale held at the till and never finished;
- a delivery recorded as pending or ordered, but already on the shelf;
- stock sent to another branch and not yet received;
- a customer return taken back without being recorded;
- a product sold under another product's code.
Adjust only what you can't explain, and write the reason in the note. A line that is short week after week is inventory shrinkage, and needs a cause, not another adjustment. A fixed rotation that covers every line over a cycle is a cycle count; see how to perform an inventory cycle count.
How to count and adjust stock in ArmPOS
ArmPOS builds the count sheet from what it thinks you hold, then corrects its stock with an adjustment.
- Open Products › Count Stock and click Count. Choose the date and warehouse, and a category to count one shelf at a time.
- Download the sheet. It is an Excel file listing each product with the quantity ArmPOS holds. Hide that column for a blind count.
- Count and write the difference beside each line.
- Open Adjustment › Create Adjustment. Choose the warehouse first, add the products, and enter the difference in Qty with Addition or Subtraction.
- Add a note, such as "October count, soap shelf", and submit. The stock changes at once.
- Record broken, spoiled or expired goods with Damages › Create Damage, never as an adjustment as well.
The guides Count and adjust stock and Record damaged or spoiled stock show each screen. The Stock Adjustment Report then totals what was added and removed, with each adjustment's cost; see Stock reports.
Two more reports help before a count. The Negative Stock Report lists products whose stock went below zero, which should be counted first. Racks and shelves set up as warehouse locations let the Internal Location Report list products shelf by shelf, in counting order.
Counting is one step of the routine in how to manage inventory in 7 simple steps. The counts also feed your reorder levels, covered in how to avoid overstocking and stockouts. The bigger picture is in inventory management for small businesses.
Frequently asked questions
How often should you do a stock take?
At least once a year, at your financial year end, for the accounts. A busy small shop does better counting one category a month, so the whole shop is counted several times a year.
Is a stock check the same as a cycle count?
Nearly. A cycle count is a stock check on a fixed rotation, planned so that every line gets counted over the cycle.
Do I have to close the shop for a stock take?
Not for a stock check. For a full take, count before opening or after closing, or count one category per day.
Who should do the counting?
Two people per area, and never just the person responsible for that stock. Teach the counting rules, blind and in the selling unit, as part of employee training.
What do I do with a difference I can't explain?
Recount it, then adjust with a note giving the date and the count. If the same line keeps coming up short, treat it as shrinkage and look for the cause.
Print your first count sheet from your own stock list: create a free ArmPOS account, add your products, and count one shelf this week.
