Business Basics Home Page Who is Bill Gaw? And why should we listen to him?	Cycle Counting - Part 2 of 5 Part 1    Part 2    Part 3    Part 4   Part 5 Cycle counting is a technique of vital importance to anyone responsible for effective manufacturing and distribution planning and control. A basic under-standing of the subject is essential for maintaining a high level of record accuracy.
	The objective of cycle counting is not counting but to get accurate records. If this can be assured without counting, then this is the ultimate objective.
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	Initial Phase of Cycle Counting Prior to initiating a full scale cycle counting program, a small sample of items should be selected which can be cycle counted repetitively as part of the daily activities of store­keepers. The objective is to select a small sample which will detect the causes of errors. Select some purchased items, some manufactured items, some similar in appearance, some small and numerous but difficult to count and some which experience a changing unit of measure from ordering through receipt into stock. After counting these items, verify that the inventory record is correct. Then reconcile and adjust the records. Count the same item at some interval short enough to insure that only a few transactions need to be studied and that only recent history needs to be investigated to detect the causes of errors. When the sample test group can be maintained essentially error free, expand the program into a regular full scale cycle counting operation. During the initial phase of cycle counting problem areas can be identified by answers to the following questions: • Is storage space adequate? • Are items stored in an orderly manner to facilitate counting? • Are items properly identified? • Is access to storage area limited to authorized personnel? • Is there an effective storage plan? • Is there a locator system and is it operating effectively? • Is obsolete, scrap, and inventory pending quality con­trol disposition segregated from "good" inventory? • Is the system for reporting daily inventory transac­tions effective? • Is responsibility for reporting inventory transactions clearly defined? • Are inventory classifications compatible with the fi­nancial accounting system? Part 1    Part 2    Part 3    Part 4   Part 5    Increase Your Knowledge... Stay Connected Join our 15,000 plus MBBP Bulletin Subscribers To stay current on Lean Manufacturing principles and techniques, subscribe to our Manufacturing Basics and Best Practices Bulletin (MBBP) and we'll send you our 10-PowerPoint-Plus, Lean Manufacturing, Mini-Modules. (All at no cost of course.)   Your personal information will never be disclosed to any third party. First Name: Your E-Mail: Here's what one of our 13,000 plus subscribers wrote about the MBBP Newsletter: "Great manufacturing articles. Thanks for the insights. I often share portions of your articles with my staff and they too enjoy them and fine aspects where they can integrate points into their individual areas of responsibilities. Thanks again."                Kerry B. Stephenson. President. KALCO Lighting, LLC "Back to Basics" Training for anyone ... anywhere ... anytime Business Basics, LLC 6003 Dassia Way, Oceanside, CA 92056 West Coast: 760-945-5596  © 2001-2013 Business Basics, LLC