Inventory glossary
What is Physical inventory count?
Physical inventory count is the process of physically counting every unit of stock you have on hand and comparing it to what your records say you should have.
For a small Shopify store, your reorder decisions are only as good as your stock numbers. If your system says you have 40 units of a candle scent but you actually have 25, you will run out before you expect to and disappoint customers who ordered online.
Run a physical inventory count at least once or twice a year, or more often for your fastest-moving or highest-value SKUs. Count everything on a set day, write down the actual quantities, then compare them to your inventory records and fix any mismatches.
Example
A candle store's records show 120 units of a lavender candle. During a full count on December 31, staff count the shelves and storeroom and find 108 units. The difference of 12 units gets logged as an inventory adjustment, and the record is corrected to 108 before the new year's sales forecasts are run.
Common mistakes
- Counting while sales are still coming in, which creates false mismatches.
- Not investigating why counts are off, so the same shrinkage or recording error repeats.
- Treating one annual count as enough for fast-selling or high-value items that need more frequent checks.
Physical inventory count and SteadyShelf
SteadyShelf relies on accurate stock numbers to forecast sales and set order-by dates, so a clean physical inventory count makes its reorder suggestions more reliable.
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Related terms
Cycle count · Inventory accuracy · Inventory adjustment · Stocktake · Inventory shrinkage
FAQ
How is a physical inventory count different from a cycle count?
A physical inventory count covers all stock at once, usually on one day. A cycle count checks a smaller portion of stock on a rotating schedule throughout the year, so counting work is spread out instead of done all at once.
How often should a small Shopify store do a full physical count?
Once or twice a year is common for most small stores. Stores with high-value items or frequent discrepancies may want to count those SKUs more often, even if the full count stays annual.
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