Cycle counting in Exact Online: perpetual inventory with ABC analysis
Cycle counting is a form of perpetual inventory where you continuously count small parts of your stock instead of everything once a year. This keeps the stock in Exact Online accurate all year round, without shutting the warehouse down. This article explains what cycle counting is, how an ABC analysis determines how often you count, and how to do it with barcode scanning.
What is cycle counting (perpetual inventory)?
With cycle counting you spread the counting of your stock across the entire year. Instead of one big annual count, you count a small, manageable part of the items or storage locations every day or week. Every item is counted several times a year according to a fixed schedule. This creates a continuous, reliable picture of your stock and lets you catch deviations while they are still small.
Cycle counting versus an annual stocktake
The classic annual stocktake has serious drawbacks: the warehouse is often closed for a day or more, workload peaks, and errors from the whole year only surface when it is too late to trace the cause. Cycle counting solves this:
- No downtime: you count small portions during the normal working day, without closing the warehouse.
- Continuous accuracy: stock in Exact Online stays reliable all year instead of only after the annual count.
- Faster root-cause analysis: because you count often, a discrepancy is recent and easier to trace to its cause.
- Spread workload: no peak of days counting, but a steady rhythm of half an hour a day.
ABC analysis: which items do you count how often?
Not every item is equally important. With an ABC analysis (based on the Pareto principle) you split your assortment into three classes by value or turnover, and attach a counting frequency to each:
- A items — about 20% of items, around 80% of value: your most important products. Count these often, for example every month.
- B items — about 30% of items, around 15% of value: count these quarterly.
- C items — about 50% of items, around 5% of value: count these once or twice a year.
This way you spend most counting time on the stock that represents the most value. Selling perishable products? Then combine the ABC classification with FIFO and FEFO and count shelf-life-sensitive items more often.
How to set up a cycle counting schedule
- Create an ABC classification: analyse your items by annual value (quantity × price) or turnover and split them into A, B and C.
- Set the counting frequency: attach a frequency per class (A monthly, B quarterly, C yearly).
- Calculate how many to count per day: divide the number of required counts by the number of working days to get a feasible daily portion.
- Plan fixed counting moments: count a fixed number of items or one warehouse zone each morning, for example.
- Assign responsibilities: allocate staff and make counting a fixed part of the day.
- Evaluate and adjust: if certain items keep showing discrepancies, temporarily raise their frequency.
Cycle counting with barcode scanning
Counting and retyping by hand is slow and error-prone. With the Barcode Scan App for Exact Online you simply scan the items due according to your schedule. The app compares the counted quantity with the administrative stock instantly and posts any discrepancy straight into Exact Online. You can count per item or per storage location, including batch and serial numbers. This turns a cycle count from an administrative chore into a task of a few minutes. Read more about the options in our article on stock counting software.
Analysing discrepancies and tackling causes
Cycle counting only truly pays off when you not only correct but also tackle the cause. See a discrepancy? Find out where it comes from: a missed scan, an unregistered transfer or an incorrect receipt. In our article on detecting and preventing inventory discrepancies we go into this in depth. By structurally adjusting, your stock becomes ever more accurate and over time you count mainly for confirmation.
Benefits of cycle counting
- Higher accuracy: an inventory accuracy of 95% to 99% is achievable with regular counting and scanning.
- Reliable delivery promises: you do not sell products that are not there and avoid unnecessary back orders.
- Less working capital: accurate stock means less safety stock and less dead capital.
- No annual peak: you spread the work and keep your team in a calm rhythm all year.
Want to move from a stressful annual count to a calm, continuous approach? Start small with your A items and expand the schedule step by step. With barcode scanning you turn cycle counting into an effortless habit.