Effective Cycle Counting Programs
The most effective cycle counting programs reflect the realities of managing inventory in a dynamic environment. A lot of organizations don’t take advantage of Infor CloudSuite Industrial (SyteLine) cycle counting process. SyteLine ERP can help your business find, correct, and trend inventory losses so inventory accuracies can be improved and maintained to reduce lost sales or late shipments.
Infor CloudSuite Industrial (SyteLine) allows you to set item cycle counts by determining the importance of items and thus allowing different levels of control based on the relative importance of items. It follows the APICS general rule of ABC principle. Using the ABC Analysis form allows the user to determine and set each item’s ABC Code by volume or annual dollar usage.
A Common Cycle count calculation is as follows:
Stratify SKUs: (annual usage X standard cost):
A items= items representing the top 80% of total dollars
B items= items representing the next 15% of dollars
C items= items representing the bottom 5% of dollars
A items are counted 4 times per year
B items are counted 2 times per year
C items are counted 1 time per year
A – About 20% of the items account for 80% of the dollar usage.
B – About 30% of the items account for about 15% of the dollar usage.
C – About 50% of the items account for about 5% of the dollar usage.
Although ABC classification is the most widespread method, cycle counts can be performed in different ways.
Zone/Location method—which is particularly good for items with fixed locations—the count schedule starts with the first location in a zone and continues daily until the last location is reached. At this point, the count begins again at the first location.
Location-audit method is best used when items are stored randomly. For this technique, a set number of locations are counted, and their inventory counts are validated each day.
Special-counts method/Transaction method, items are selected to be counted based on criteria such as zero balances, receipt or issue transactions
Organizations sometimes waste money by carrying too much inventory, while carrying too little can result in lost sales or late shipments. Infor CloudSuite Industrial (SyteLine) can help you accurately size your inventory in make-to-stock and make-to-order environments.
Let ERP Software Pros show you how Infor (SyteLine) CloudSuite Industrial can help your company automate the process of calculating and monitoring your inventory drivers. We can assist to keep inventory accurate and low while avoiding shortages.