Table of Contents Hide
Running your own business can be a beautiful way to make a living. There’s a reason, after all, why business owners are some of the most satisfied workers around.
You get to set your own hours, make the rules, and chart your own path toward success. However, running your own business also means handling a lot of responsibility.
If you work in a mechanically heavy industry, that will also mean managing and maintaining your own equipment inventory. This can be tough work, which is why determining a regular way of going about this task can be so important.
What are a few steps you can take to make this process a bit easier? Read on and we’ll walk you through what you need to know.
1. Consider Cycle Counting
When it comes to the equipment audit process, there are two ways to go about this work: physical counting and cycle counting.
Physical counting is what you’d expect from an audit: counting every single physical unit. This can be, as you can imagine, time-intensive and disruptive to a business.
Cycle counting is when a business essentially audits a test sample of its inventory, meant to be representative of the whole. This small selection is regularly compared to what is shown on something like this Equipment Tracking System.
If there are no discrepancies, work can continue. If there are, it’s a sign of a more serious problem. While a full physical count will still need to be done at least once a year, cycle counting helps accountability month-to-month without all the work that a full count would require.
2. Hire an Outside Auditor
If you have the budget for it, there are many benefits to bringing on an outside auditor to do this work as opposed to having one of your own staff do it.
For one, this will allow your staff to stick to their normal day-to-day job responsibilities and keep your business running. But an outside perspective can also be quite helpful when it comes to an audit.
An outside auditor can take a tough, unbiased look at an inventory. They will not fall into the trap of seeing things as they are used to seeing them, and they will not be swayed by internal knowledge of the inner workings of the company.
You’re likely to get better, more accurate results when you work with an outside auditor.
3. Prepare Audit Documentation
Before your auditor arrives, make sure you have the proper documentation ready for them. That would mean your inventory records, all of your shipping and receiving reports, and the bill of sale for each piece of equipment in your inventory.
If possible, it’s also smart to have your policies regarding this equipment written out and provided to an auditor. They might need to review this information during the task at hand.
Performing Regular Equipment Inventory Audits
Equipment inventory audits are a necessary part of running an equipment-based business. There’s just no getting around them.
However, if you don’t want inventory management to disrupt your business operations, you’ll need to go about this work in an intelligent way. The above information can help.
Need more advice on running our business? Keep scrolling our blog for more.