In the licensed trade and hospitality sector the success of a business is completely reliant on how effectively stock is turned into cash.
Questions around how to improve yields and profits need to be considered. How can a business effectively certify its stock? How does a business know what stock it has? Where are losses occurring? How can a business identify and minimise those losses?
What are the benefits to a business of regular stocktaking
As well as meeting its tax obligations there are some very clear benefits for any business in regularly engaging a qualified stocktaker / valuer to assess and evaluate its levels of stock. These can include:
- gaining a better understanding of stock levels
- ensuring a business does not hold too much or too little inventory on hand
- identifying and reducing slow moving stock
- identifying potential theft or damage
Stock can be seen as a vulnerable asset. By stocktaking regularly businesses can quickly identify whether there is a discrepancy between what they think they should have and what they actually have. It can also introduce best practice to the business around inventory management and cost control.
A stocktaker and valuations expert has the expertise and tools to be best positioned to help businesses identify stock issues. By auditing stock on a regular basis a business is guaranteed to have timely information and accurate detail on stock levels to help them better understand their business financials and profit margins.
Businesses that typically consider regular stocktakes are predominately within the licensed trade or hospitality sector where food and liquour is their currency. These can include:
What a business should expect with a stocktake
A stocktake will cover a number of activities. It will involve the onsite presence of a qualified and experienced stocktaker who will do a comprehensive count across food, ingredients and beverages as required, provide same day stock reports, complete an analysis of the business results and provide practical advice and guidance to support a business understand how to improve their results.
The steps involved can include:
- Meeting the business owner or manager to understand performance and current processes. Looking at the business challenges and benchmarking against industry norms.
- Carrying out a detailed count across every stock item; measuring how well a product is performing against others or identifying any dead or obsolete stock.
- Identifying any theft or losses and control issues within the business.
- Processing information to generate a detailed stock report.
- Presenting detailed item for item results on product lines back to the business.
- Delivering value through insights and recommendations to the business on how to move it forward to increase gross profit margins and make it more money.
Continuity of stocktaking services is so important to businesses in the licensed trade and hospitality sector. After all it is a key business asset.