Inventory Restaurants: Best Practice: Counting and Entering Stock and Stock Reconciliation

Overview

This article outlines the best practice method for counting and entering a Stock Count.

There are some key practices that can make the entry of stock data easy and straightforward. Preparation is key when counting stock. Having an organised, methodical manner for the process, as well as having time and resources available to do so ensures ease of the process.


Stock Counting

A business will often count stock at fixed points in the calendar to allow the monitoring of usage and cost of the goods in the business. 

Accuracy is crucial when it comes to physical stock counting. It is advised that before the count is started, the areas to be counted should be clean and tidy, any partial cases should be tidied and grouped where possible and any rubbish removed from the count areas. Labels should face forward for easy reading and grouping of similar products.

When in the process of counting stock, count from left to right in the subsection of the business to be counted.  

Printing the Stock Count Sheet
 

• Go to Stock Management, then Stock Count

 
Fig.1 - Stock Count Link

• To print the Stock Count sheet, select Print Full Stock Count

 
Fig.2 - Print Full Stock Count Link

• Select Run to generate the Stock Count sheet

Fig.3 - Run Button

• Once the sheet is generated, select the Printer icon at the top right of the screen to print 

• Use the Stock Count sheet to count against

Fig.4 - Stock Count Sheet

Inputting the Stock Count
 

• To enter the Stock Count, go to Stock Management and select Input Full Stock Count

Fig.5 - Input Full Stock Count Button

The Print Stock Tally sheet matches the ‘Input Stock Count’ page exactly, ensuring ease of entering quantities.

Please Note: No field should be left blank.
 

Fig.6 - Input Stock Count Page

• To add numbers when entering quantities, use the + sign, e.g. enter the quantities 9+8+6, then press tab on the keyboard
• To move down the page, use the tab key, and to move up the page use the shift key then tab
• To save, use the Enter key

 
Fig.7 - Inputting The Stock Count

• Once the stock is entered, select Save & Return

Fig.8 - Save Buttons

Please Note: It is best practice to save continuously when entering stock. If the system logs out due to inactivity and the stock count was not saved after every 100 products or so, then the quantities entered could be lost and will need to be re-entered.
 

Reconciling Stock

Once the stock has been entered, the period can be closed. The quantity and value of the stock will then be displayed in reports.

To access these reports, the Stock Period needs to be closed. 
 

• To close the Stock Period, select Stock Management

 
Fig.9 - Stock Management Tab

• Select the Close button 

Fig.10 - Close Stock Period Button

A pop-up will display to confirm that the Stock Period should be closed.
 

• Select OK

Fig.11 - Close Stock Period Confirmation

If there are any Pending Deliveries or Transactions in the stock period, alerts will be displayed, as seen in Fig.12. 

Best practice is to ensure that there are no pending transactions in the current Stock Period before closing it. To do so:
 

• Return to Stock Management and approve all relevant transactions, delete any that will not occur and move any that are expected in the next period 

 
Fig.12 - Stock Period Warnings

Once the Stock Period is closed, the Unit Accounting Figures, Management Figures and Stock Reconciliation report buttons will display, seen in Fig.13.  
 

Fig.13 - Stock Management after stock period closure - report buttons

The main report to be used is the ‘Management Figures’ report which shows the closing value of stock and the Cost of Sale.  

Fig.14 shows an example of the Management Figures Report. It displays the Opening Value of the stock, all deliveries of goods and all transactions in and out of the business. The Closing Value of the stock will be calculated from the inputted count and a Cost of Sale will be produced from these transactions. 

Please Note: The Opening and Closing values are the Weighted Average values of the stock. The Purchase Value is the actual price paid for the goods and the Transfer Value is the cost of the goods from the allocated Supplier.
 

 
Fig.14 - Management Figures Report

Ideally, the processes in the system would not be left until the last minute before entering the stock count. It is recommended that allocated times to carry out the processes required by the system are built into the Management Week. These processes include: 
 

• Ordering goods
• Receiving deliveries and invoices
• Raising credits
• Requisitions (if applicable)
• Site transfers
• Wastage
• Account transfers
• Checking sales (if applicable)

Stock Reconciliation

See P2P&I - Stock Reconciliation Fields Explained for more detail on the columns on the Stock Reconciliation Report. 

The ‘Usage Qty’ column on the Stock Reconciliation Report should always be a positive figure or a zero. A negative usage figure implies that there is a higher Closing Quantity in stock than there was in the Opening Stock and deliveries and transfers.  
 

• To resolve this, double-check the Closing Stock again and if this is correct, re-check the deliveries and transfers

If the Usage is still negative, check the ‘Diff Qty Last’ column as the error could be from the previous Stock Count.
 

 
Fig.15 – Stock Reconciliation Report

If all processes/actions are carried out at the end of the Stock Period, this greatly increases room for error and does not allow suitable time for checking variances on the Stock Reconciliation report. 

Ensure that adequate preparation has gone into the counting process when closing a Stock Period. It is advised to keep areas to count neat and tidy, that the Count Sheet has been printed in advance, and that Stock Holding Levels are as low as possible to minimise counting errors. 

There are likely to be discrepancies for any items sold as a fraction of itself, e.g. a shot of vodka, a portion of pie. However, the differences should be small and explained where possible.

Possible scenarios that occur during Stock Reconciliation are detailed in the section below which may highlight where an issue has occurred during Reconciliation. 


Opening with a Negative Opening Stock
 

 
Fig.16 - Negative Opening Stock

The Opening Quantity is the quantity from the previous Stock Period so it cannot be changed. 

A negative Opening Quantity is due to a negative Closing Quantity on the previous Stock Count. This usually occurs due to a Stock Quantity not being entered against the item on that count.

The system will calculate the Closing Stock is if no figure is entered. The calculation is as follows:
 

Opening Quantities, +/- Deliveries +/- Transfers – Sales

If Sales were higher than the quantity of Opening Stock + Deliveries and Transfers, then the system will assume a negative Closing Stock. 
 

• To resolve this, ensure that the Closing Quantity is correct for this period, as this could help correct the issue for the next period 

Closing with a Negative Closing Stock
 

Fig.17 - Negative Closing Stock

This only usually occurs when a Closing Quantity was not entered.  

The system will calculate the Closing Quantity using Quantity +/- Deliveries and Credits +/- Transfers - POS Quantity. In the example shown in Fig.17, the total creates a negative Closing Value.

The blue icon next to the product name indicates that this product was not counted in this period. It is recommended that only Invoice Adjustments should have this icon at the end of the period. 
 

• To resolve this, enter the Actual Closing Quantity 

Closing with a Negative Usage
 

 
Fig.18 - Negative Usage
​​​​​​​

A negative Usage Quantity implies that the Closing Stock is greater than the Opening Stock, Deliveries and Transfers. 

To resolve this:
 

• Ensure that the Closing Quantity was entered correctly from the page to the system
• Ensure all deliveries were entered correctly into the period 
• Ensure all transfers are correct 
• Check the 'Diff Last' column. If the figure was down by the same quantity in the last period, and the user is certain that the Closing Quantity is correct this time, then it could be that the error was in the last count and that it is now correct

Closing with a Negative Difference
 

 
Fig.19 - Negative Difference

A negative figure in the 'Difference' field suggests that a quantity of this Product is missing.

This can occur due to a number of reasons. To resolve the issue:
 

• Ensure the Closing Quantity was entered correctly from the page to the system
• Ensure all relevant deliveries have been correctly approved and that no deliveries from outside of this period have been approved into the incorrect Stock Period
• Ensure all relevant credits (supplier returns) have been approved out 
• Ensure all requisitions, site transfers and transfers to accounts have been entered 
• Ensure all POS figures have been verified
• Ensure that the recipes this product is used in are correct
• Check similar products to view if they are up in quantity that this product is down in, as this is an indication of cross ringing on the till 
• Check the Diff Last column. If the figure was down by the same quantity in the last period and the user is certain that the Closing Quantity is correct this time, then it could be that the error was in the last count and that it is now correct

Closing with a Positive Difference
 

 
Fig.20 - Positive Difference

A positive value in the Difference column indicates that a quantity of this product was sold more than was expected in the Usage column.

Closing with a Positive Difference Last
 

 
Fig.21 - Positive Difference in The Last Stock Period

A positive figure in the 'Difference Last' column indicates that the last time the stock was closed, the quantity in this column was positive.

This cannot be changed and its function is to be an indicator of what happened in the last period.  

If there is a negative Difference, it can be an indication of a miscount in the last period.  

If the "Difference" and "Difference Last" columns are regularly positive, this can indicate regular miscounting or incorrect recipes.

To avoid this:
 

• Ensure all relevant deliveries have been entered into the system 
• Ensure all relevant transfers have been entered
• Ensure all POS sales are correct and not under-portioned

Closing with a Negative Difference Last
 

Fig.22 - Negative Difference in The Last Stock Period

A negative figure in the 'Difference Last' column shows that the last time the stock was closed, there was a negative quantity in this column.

This cannot be changed and is as an indicator of what happened the last period.

If there is a positive difference in this period, it can be an indication of a miscount in the last period. 

If the "Difference" and "Difference Last" columns are regularly negative, this can indicate regular miscounting or incorrect recipes.

To avoid this:
 

• Ensure all relevant deliveries have been entered into the system
• Ensure all relevant transfers have been entered
• Ensure all POS sales are correct and not over-portioned

The Stock Reconciliation Report reflects the actions carried out by users in the stock period. Only transactions that have been approved will be reflected in the Stock Reconciliation. If all deliveries, transfers and stock are accurately and correctly entered in the system, then the areas for discrepancies are reduced.

Recipes should be checked often and seasonally to ensure that differences between Usage and POS are minimised as much as possible.

Cross ringing on the EPOS, as well as ‘OPEN Food’ and ‘OPEN Beverage’ should be avoided when possible to minimise differences.  
 
Also See
 

• Inventory | Restaurants - Inputting a Line Check
• Inventory | Restaurants - Stock Reconciliation vs. Accounting Report [R9]
• Inventory | Restaurants - Stock Reconciliation Fields Explained
• Inventory | Restaurants - Clearing the Entire Stock Count
• Inventory | Restaurants - Item Not Appearing on Stock Input Page