The final blog in our stocktaking series is the analysis of the data collected; there is no point in carrying out a stocktake if you are not going to analyse the data. By analysing the data, you will be able to identify any discrepancies between the stock and the sales data. Any stock discrepancy is bad for your business. Even if you have more stock that you were expecting as your company will be running on incorrect data which has a direct effect on your profit or loss.
Analysing your stock allows you to:
1. Know what you are making in real time
The only way to gauge the performance of a business is to know what you are making, analysing your stock allows you to do this as you will have up to date information on what stock you have in the building and what needs to be ordered
2. Safeguard against theft or fraud
An analysis of the stocktake will allow you to identify any discrepancies (whether that be missing stock or more stock than you were expecting) you can then uncover the cause of these discrepancies and put procedures in place to ensure they do not happen again. You should always remember that your stock is a source of revenue and any malicious activity will have a negative effect on your business.
3. Compare your stock levels against your sales
Identifying any overstocking or shortages in your stock will help you establish an ideal re-ordering process, as you will be able to see if you are ordering in to much or to little stock. This analysis may lead to you changing your par stock levels and/or your ordering levels to ensure you are not running out of items or holding too much excess stock.
The most common causes of discrepancies are: (not listed in any order)
· Theft – this is not something anyone wants to believe their employees or customers are capable of, however it does happen, and all businesses need to be aware that if they are not counting their stock regularly then this might happen. There are several measures that can also be put in place apart from regular stock counts the most common ones are: limiting who has access to the storerooms and ensure employees do not keep their bags in stock room
· Incorrect costings – if the recipes that you use are inconsistent, your stock will be incorrect and there will be discrepancies. This is as you could be accounting for too much or little of a particular line or even be account for the wrong stock line. The other reason recipes might be wrong is if you have run out of one product and another is used in its place
· Incorrect selling prices – it is important to make sure that the prices on your till and menus are correct, not only does it look unprofessional if there are differences between your till system and your menus, how do your employees know which is the right one? However, the main issue is if the price isn’t correct this will affect your profit.
· Delivery Shortages – Making sure that you check all your deliveries correctly is a major control when dealing with stock, ensuring that what you think has come into the building is actually there will ensure no discrepancies in the stock count. Also, you really do not want to be paying for something that you have not received
· Undercharging at the point of sale – there are many reasons why this could happen, for example they could be completely honest and be discounts or complimentary drinks that you or your employee have given out. Or that could be because someone is charging their friends less for drinks. Whatever the reason it needs to be accounted for, if it is a discount or complimentary, set up your till system so it still tracks the sale and the reason for it. We all know that sometimes this must happen but make sure you track these discrepancies to ensure that your drinks are not being sold for less without a good reason, this can significantly decrease your profits
· Wastage – is probably the most common reason for discrepancies when it comes to stock takes. For your stock take to be accurate you need to ensure that all wastage is recorded and logged, either on your till system or as part of your stock taking system.
Analysing the stocktake allows you to quickly identify issues that could impact the profitability of your business, no business is too big or too small to carry out stocktakes; however, most of the smaller business chose not to carry them out.
This was our final blog post regarding stocktaking, I hope it was not too horrible and that you have taken away something that will help your business become more profitable in the future.