INVENTORY & WAREHOUSE OPERATIONS
Physical Inventory
A physical inventory is an organized count of stock within a defined scope at a controlled point or period, used to verify inventory records.
PHYSICAL INVENTORY IN PRACTICE
- Define scope & cutoff
- Count & record stock
- Reconcile & approve differences
A WORKED EXAMPLE
A count of 980 against a record of 1,000.
A controlled count records 980 eaches while the matching system snapshot shows 1,000. The variance is −20. Before an adjustment, check for stock in staging, excluded holds, transactions near the cutoff and unit errors. Keep original counts, recounts and approvals as separate evidence.
WHAT THIS MEANS FOR YOUR QUOTE
Make the requirement explicit
Use the same scope and units when comparing providers. Put the agreed responsibility, included work and exception process into the service description.
Put this term to work. Use the 3PL selection guide to turn these operating requirements into provider checks, and the 3PL RFP guide to document evidence, responsibilities and exceptions.
A LITTLE MORE CONTEXT
Questions about Physical Inventory
Must a physical inventory close the entire facility?
Not always. The procedure may use a shutdown, scoped freeze or other controlled movement method.
Is a cycle count also a physical count?
Yes. A cycle count physically checks a selected subset as part of an ongoing program.
Source & example notes
Oracle Inventory User’s Guide: cycle counting. Further reading on the related controls and terminology. Product documentation describes a particular implementation; it does not establish a universal procedure or service commitment.
Definitions and worked examples are prepared by 3PL Hub. Numbers are illustrative, not provider rates, operating targets or guarantees.
Last updated: · 3PL Hub
