Purpose and Scope
This procedure sets out how [Organisation Name] physically counts and reconciles stock at [Location], covering [Stock Categories]. It applies to everyone involved in receiving, counting, handling, or recording inventory.
Working through related paperwork at the same time? See also our UK Stock Take & Inventory Template, Customer Complaint Handling Procedure Template and US Customer Complaint Handling Procedure Template.
Types of Count and Frequency
- Full physical count: A complete count of all inventory across all locations, run at [Frequency] to align with accounting period ends.
- Cycle counts: Rotating counts of specific stock categories or physical areas, run at [Frequency] during normal operations without stopping trade.
- Spot checks: Unannounced counts of high-value or high-risk inventory lines, run by [Role].
Roles and Responsibilities
- Count Lead ([Role]): Sets count schedules, establishes cut-off times, issues count sheets, and approves final figures.
- Counters: Count physical stock, working in pairs where possible. Counters record inventory exactly as found and must not independently count areas they hold sole operational responsibility for.
- Data Entry Lead ([Role]): Enters counts into [System Name], generates variance reports, and maintains official records.
Pre-Count Preparation
- Freeze all stock movement starting at [Time] until final sign-off. Accept no deliveries and transfer no stock between areas during this window.
- Process all outstanding paperwork, including receiving logs, vendor credits, stock transfers, and waste records, to bring system records up to date.
- Clean and organize all storage areas so stock is clearly visible and grouped logically to match the count sheet sequence.
- Issue blind count sheets from [System Name] with item descriptions and locations, leaving expected quantities blank.
- Identify, mark, and exclude non-owned inventory, such as customer-owned items, consignment stock, and goods already invoiced.
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Counting Procedure
- Count items systematically through each section. Record figures immediately using standard units specified in [System Name].
- Measure, weigh, or estimate open or partial containers using the approved method for [Stock Categories].
- Check expiration dates while counting. Move expired or damaged goods to the designated waste area and log them as waste, not physical stock.
- Mark each shelf or area physically as you finish it to avoid duplicate counting or missed inventory.
- Sign and date completed count sheets. Return illegible or unsigned sheets to the assigned counter for correction.
Variance and Shrinkage Investigation
- Generate the variance report in [System Name] immediately after entering counts.
- Investigate all variances exceeding [Threshold] in value or percentage per category, following this order:
- Recount the physical line item immediately.
- Check for unrecorded receiving logs, credits, or pending transfers.
- Review recent waste logs and conversion records.
- Cross-reference sales and transaction data for the period.
- Escalate unexplained discrepancies (shrinkage) to [Role] for further investigation, which may include targeted spot checks, transaction void reviews, surveillance audits, or formal disciplinary processes.
- Obtain authorization from [Role] before adjusting inventory balances in [System Name] to match physical counts.
Waste, Damage, and Stock Rotation
- Record inventory waste and damage immediately in [Location/System Name] using specific reason codes.
- Rotate inventory using First-In, First-Out (FIFO) principles, placing new stock behind existing stock on shelves.
- Ensure [Role] performs regular stock date audits at [Frequency].
- Manage date rotation, safe storage, and restricted stock according to applicable licensing requirements and safety standards.
Records and Review
- Keep signed count sheets, variance reports, and waste records at [Location/System Name] for [Retention Period] to support financial and tax requirements.
- Review this procedure [Frequency], after any count that yields significant unexplained variances, or whenever inventory management systems, categories, or physical locations change.
- Document Owner: [Role].
- Next Review Date: [Date].
FAQs on a stock take and inventory procedure
What is a stock take and inventory procedure?
A stock take and inventory procedure sets out how your organisation physically counts and reconciles stock at your site, covering the stock categories you choose. It applies to everyone involved in receiving, counting, handling, or recording inventory.
Having it written down means the same rules apply to everyone, so managers are not making judgement calls case by case under pressure.
What does a stock take and inventory procedure include?
This template covers types of count and frequency, pre-count preparation, counting procedure and variance and shrinkage investigation.
Every section is written to be filled in. The bracketed placeholders mark the decisions that are yours to make, such as timescales, approval owners and retention periods.
How to implement a stock take and inventory procedure with Whale
Copy this template into Whale and work through the bracketed placeholders so it reflects how your organisation actually operates.
Assign it to the teams it applies to so it sits where people work rather than in a shared drive, and set a review date so it gets revisited on schedule instead of quietly going out of date.
Use our templates to fast-track your documentation
Customize this template and 100s of others for free in Whale, the fastest way to get your team aligned.
