Case Study: Cutting Shrink 20% with Weekly Cycle Counts
Background
A medium-sized retailer noticed rising inventory shrink. Traditional yearly physical inventory counts failed to identify issues soon enough. Losses from theft, miscounts, and spoilage affected profits. The management team wanted a better way to track inventory and reduce shrinkage.
Approach
The retailer introduced weekly cycle counts. Staff counted inventory in selected sections on a rotating basis. Each week, different products or aisles were checked. The team compared actual stock to recorded inventory levels in the system.
Discrepancies were flagged. Managers investigated causes—such as scanning mistakes, misplaced stock, or possible theft. Corrections were made in real time. Proper training ensured staff understood procedures.
Results
After six months, the retailer saw a 20% drop in shrink. The most common issues were incorrect receiving, labeling mistakes, and occasional internal theft. Frequent counts allowed faster response to problems. Staff fixed issues before they grew.
Other benefits included more accurate stock levels and fewer out-of-stock incidents. This improved order planning and reduced rushed emergency shipments.
Key Takeaways
- Frequent cycle counts help spot errors and shrink sooner.
- Investigate all discrepancies right away.
- Train staff on accurate counting and stock handling.
- Keep cycle counts consistent—weekly, not just yearly.
Weekly cycle counts provided the retailer with better control over inventory and lower shrinkage. This steady approach allowed fast course corrections and improved bottom-line results.
