CSCMP's Supply Chain Quarterly
December 16, 2018
Forward Thinking

Study documents benefits of cycle counting

Higher inventory accuracy, greater warehouse efficiency are among the reasons to adopt cycle counting, says Tompkins Supply Chain Consortium report.

If you've ever wondered whether cycle counting is a worthwhile exercise, then the results of a new survey should help you to lay aside any doubts. According to the Tompkins Supply Chain Consortium's Cycle Counting Report, companies that have a cycle-counting program achieve an average 98-percent inventory accuracy. Seventy-five consortium members in manufacturing, retail, and distribution took part in the survey.

Cycle counting involves conducting periodic checks of inventory in a warehouse, as opposed to doing a physical count of all items in storage on a set date, such as the end of a fiscal quarter. The report found that nearly half of all respondents used a combination of cycle counting and physical inventory checks to verify and monitor the accuracy of information about stored items.

Bruce Tompkins, executive director of the consortium and author of the report, said that the benefits of cycle counting include reduced operating costs, higher service levels, improved shipping accuracy, and lower inventory levels. Cycle counting can also boost labor efficiency and product flow by identifying and correcting inventory discrepancies before they impact normal operations, he added. "Cycle counting is critical to any company seeking higher inventory-accuracy levels and greater efficiency in the warehouse," he said.

For more information, download the Cycle Counting Report.

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