While the end of the year is all fun and games for consumers, it can be a stressful period for business owners. Not only do you have to keep up with the demands of the holiday shopping season but, for many, it’s also time to ensure that your inventory records are accurate.
This guide breaks down the basics of calculating your ending inventory value and best practices, so you can start next year on a good note.
Your end-of-year inventory count is important because it makes sure what stock you have on the shelves matches what’s in your books. Essentially, it’s one large cycle count. However, instead of breaking your inventory into small sections and completing a whole count over several weeks, it’s done all in one push.
Once you have your inventory count complete, then you’ll be able to know your ending inventory and complete a yearly financial analysis. Your ending inventory is the total value of all the products you have available for customers at the end of the year, which typically aligns with most business’ accounting period.
Having a reliable POS System, like Clover, is essential for having accurate, real-time sales data. Whether you’re on the Station Solo or Flex, keep track of sales on one system. That means less time managing records and more time selling during the holiday season.
Conducting your end-of-year physical inventory with an inventory management platform, like Shopventory, will help you automate the count.
Easily view any stock discrepancies and sync out any inventory edits to your Clover account and/or eCommerce platform.
Calculating your ending inventory is a huge feat and having staff you can count on is essential. In order to hold your team accountable, set user permissions in Clover and Shopventory to have greater control over sales and inventory changes.
Also, require a manager’s approval before submitting your final physical count and making changes to your sales channels.
While you can complete your physical inventory count using online spreadsheets or a pencil and paper, that increases room for human error.
Barcode scanners not only increase accuracy but can save you hours as you cycle through your stock.
With Shopventory, users can use a mobile barcode scanner app or their own physical barcode scanner to count each product’s barcode and quantity.
If you’re not using an inventory management software, like Shopventory, that automatically calculates your ending inventory, then you’ll have to use the following ending inventory formula.
Here’s how that formula breaks down: