Skip to main content

Guide to Understanding and Analyzing Your Inventory Discrepancies

Updated over 8 months ago

This help article was translated using AI and may contain inaccuracies. If you are unsure about any information, please refer to the original version in French for accuracy.

To start, let's clarify the essential terms you need to master to analyze your inventory discrepancies.

  • Stock entries: they result from supplier orders, emergency purchases, and incoming transfers.

  • Stock exits: they include declared losses, outgoing transfers, internal sales, as well as POS sales.

  • Inventory losses: they correspond to the difference between the theoretical quantity and the actual quantity. They are quantified and evaluated, thus providing a precise view of your unknown shrinkage.

  • Negative inventory losses: they occur when the actual stock of a product exceeds the expected theoretical quantity, indicating a surplus compared to expectations. Consequently, the amount of discrepancies is recorded as a negative value.

  • Positive inventory losses: they occur when the actual stock of a product is less than the expected theoretical quantity, indicating a loss of products compared to expectations. The resulting amount of discrepancies is recorded as a positive value.

πŸ’‘ In general, ensure that your inventory losses do not exceed 5% of the total valuation of your inventory.

Step 1: Where can I find detailed information on inventory discrepancies?

Go to the "Inventories" section and select the inventory you are interested in. There, you can immediately view the amount of your inventory, corresponding to the valuation of your stock, as well as the amount of inventory losses resulting from your inventory discrepancies.

Theoretical

The theoretical quantity in stock is determined by the movements of entries and exits.

Counted

It indicates the quantity counted during the inventory.

Real

It represents the counted quantity + the quantity present in the counted recipes (if stock management is not activated for these recipes).

Stock Discrepancy

It indicates the difference between the theoretical quantity and the real quantity.

Real Amount

It reflects the valuation of your inventory.

Loss Amount

It corresponds to the valuation of your losses, that is, your inventory losses.

If you are looking for more information on inventory valuation, check out our dedicated article πŸ‘‰ How are inventories valued on Yokitup?

Now that you have all the tools in hand, let's embark on the adventure of inventory loss hunting! In your inventory, click on "Close sections" and identify the tags where inventory losses are high. Open these sections and isolate the products with significant discrepancies.

Once your products are identified and isolated, click on the three small buttons to the right of the product. Then, choose "Stock evolution by product" or take a detour through the "Analysis" module and then go to "Stock evolution by product".

Step 2: How to understand the stock evolution of your product?

The "Stock evolution by product" module will reveal, with the help of a graph, all the stock movements of a product on a site over a defined period. Thus, it will offer you a quick understanding of the causes of these particularly high inventory losses.

Before getting to the heart of the matter, here is a quick explanation of the information that animates this graph πŸ‘‡

Green bar

Represents your incoming stock, thus all your stock entries.

Red bar

Represents your outgoing stock, thus all your stock exits.

Purple curve

This curve illustrates the variation of your stock over the days.

Yellow dot

It illustrates each inventory conducted, highlighting the theoretical stock at the time of each inventory.

Yellow bar

It indicates your negative inventory losses, representing a stock surplus identified following an inventory.

Magenta bar

It indicates your positive inventory losses, that is, your unknown shrinkage, identified following an inventory.

Below are several practical cases with our analyses, so you can better understand this graph and thus draw your own conclusions πŸ‘‡
​
​Graph number 1.


​By analyzing this graph, one might suggest that a new delivery took place on 09/23, thus explaining the increase in stock between 09/23 and 09/28. It is interesting to note that the buffer stock seems to stabilize around 30/40 kg. The second delivery on 09/28 seems less pronounced, probably due to an already substantial stock at that time, even exceeding the usual buffer stock level, with stock exits not increasing from one period to the next.
​Then, we notice that the last delivery dates back to 10/05 and that no new stock entry has been initiated since. This could be explained by the realization that there was an excess of stock, requiring prior clearance before any new order. Or, the decision could result from the possibility that the product is no longer sold, making a new order unnecessary.
​
​

Graph number 2.

Capture d’écran 2023-10-17 aΜ€ 17.33.18.png

Regarding this second chart, the order pace seems constant, with a frequency of about one order every two days. However, between 09/28 and 09/29, there are two stock arrivals with only one day difference, with quantities higher than normal. Quite coincidentally, an inventory was conducted on 09/30, resulting in negative inventory losses, meaning the stock is lower than it should be. It can be considered that ordering large quantities in a short period led to these losses.

In other words, it can be considered that the order from 09/28 should probably have been received on 09/25 to maintain the initial order pace, but it was closed late. It would be interesting to check in the order in question if the desired delivery date matches the indicated receipt date.

Chart number 3.

Screenshot 2023-10-13 at 12.44.12.png

Above, you will find a chart illustrating a consistent cyclical pattern, with an increase in stock during entries and a decrease during exits, thus creating a cycle. It is also notable that regular inventories are conducted, and very few inventory losses are visible, clearly indicating controlled stock management. To delve further, it would be pertinent to understand why, on 10/9, inventory losses are observed despite effective stock management.
​
Below, discover several reasons that may cause abnormal inventory losses.

Inventories:

πŸ‘‰ Products not counted during the last inventory

πŸ‘‰ A typo during the product count

πŸ‘‰ Products inventoried during stock movements (sales, orders, etc.)
​
Stock entries:

πŸ‘‰ A typo during the receipt of an order

πŸ‘‰ A supplier order not integrated into Yokitup

πŸ‘‰ A supplier order not closed

πŸ‘‰ Incorrect closing date, not matching the actual receipt date

πŸ‘‰ Order packaging modified during an ongoing order
​
​

Stock exits:

πŸ‘‰ If a cash register button is not associated with its product or technical sheet

πŸ‘‰ In case of a bad association with the cash register, it is important to check if the product or technical sheet is correctly linked to the corresponding button, and if the storage packaging matches what should be removed during a unit sale. The presence of a red triangle indicates an association with a product or technical sheet deactivated on Yokitup, requiring correction.
​
​

Technical sheets:

πŸ‘‰ Check that the product is included in all the technical sheets where it is supposed to appear

πŸ‘‰ Please be attentive to poorly filled technical sheets to avoid overestimation or underestimation of quantities.

πŸ‘‰ Consider the gross weight/net weight, especially in the case of boneless meat, and for that, feel free to check out this article: Managing the conversion of gross weight & net weight of your ingredients
​
The operational part:

πŸ‘‰ An absent manager

πŸ‘‰ Theft within your establishment

πŸ‘‰ Technical sheets not followed

πŸ‘‰ Excessive orders leading to waste

πŸ‘‰ If identified losses are not recorded in the tool

You understand, whether inventory losses are positive or negative, they can result from many factors. It is now up to you to identify them to better manage your stocks! πŸ’ͺ

Related articles:

Did this answer your question?