End of Financial Year (EOFY) is such a busy time, and if you have a product-based business this usually means it’s stocktake time.
How do you manage your stocktake without losing your mind?
Do you sit there on 30 June counting every widget? And what is your process if you do count the widgets?
There are some simplified trading stock rules which means that you may not have to do a stocktake for tax purposes:
- You need to be defined as a small business
- The difference between opening and closing stock for the year is $5000 or less (so this indicates that you must at least have an opening stock balance at some stage – and normally this would happen from a stocktake).
However, many small businesses have high turnover in stock and change stock lines throughout the year, meaning their closing balance will be more than $5000.
If you’re in that situation and need to do a stocktake, how do you avoid stocktake stress?
1. Get organised
Make sure the space you store your stock in is organised.
Group the same stock together, separate out different stock, put stock into piles and label everything.
Whilst this may seem like a tough job (and probably will be if you are slightly unorganised), you’ll give yourself one all mighty pat on the back when it comes time to actually counting the stock at end of financial year.
2. Get rid of ‘turtles’
Once you have organised your stock to within an inch of its life, has the process identified any “turtle”, or slow-moving stock.
It’s time to get on social media and have an EOFY sale.
Much better to get rid of any slow stock before it becomes obsolete, so get that stock out of your store room and get customers to take it home with them.
Look out for obsolete stock or stock that has expired, and deal with this before 30 June hits.
The less in the stock room to count, the easier the process will be.
3. Run a stock listing report
MYOB AccountRight should make this part a breeze.
With the touch of a button, you can print out a listing of your stock balances listed by stock codes.
If you’ve followed my first tip and have a super organized stock room, this stock listing report will make counting stock a breeze.
I’m not saying everything will match, that is the whole point of a stocktake – to see what variances there are and to understand why.
However, if you have a stock listing report the process should be smooth sailing.
4. Ask for help
You don’t have to face stocktake alone. Grab one of your business besties, grab your stock listing, pump some tunes and get cracking.
Not only will you have someone to keep you sane, you will get the stocktake done in half the time (hopefully).
5. Put aside time
Lock in a time in your diary to do stocktake.
It doesn’t have to be at 7am and it doesn’t have to be at midnight – pick a time that you know you can set aside a few hours to tackle this task interruption-free.
Don’t do it during your busiest time, don’t do it with the phone ringing non-stop and don’t assume it will only take 30 minutes.
Block out half a day, and if you finish early – well pour yourself a glass of bubbles to celebrate.
6. Write it down
Once stocktake is over, it’s the perfect time to document your processes and procedures around stocktake.
It will be fresh in your mind, and having a set process on paper will help next time you need to do a stocktake.
Your documentation should also include your policy around obsolete stock, writing off stock and whether or not internal controls need to be tighter around your stock management.