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Harry, 

I'm sorry I didn't respond earlier, and hope this is helpful.

Certainly should partner up with your accounting/controller group with regard to this, but from a maintenance reliability point of view, the slow-turning critical spares should be accounted for.  At the other end of the spectrum are the more commonly-used fast-turning items, for which you most likely have a feel for usage rates and reorder points and quantities that account for the suppliers' lead times on the items.  In my experience, we'd try to have a prescribed cross-cut of 1/4 of all inventory items, for which we would complete cycle counts on a quarterly basis, so that we had a count on all inventory items over the calendar year.  This objective could be adjusted based upon requirements of your specific operations and controllership.  

Best wishes, 

Terry Easterwood, CMRP
President/Owner - TMEI Services LLC

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Terence Easterwood
Owner/President
TMEI Services LLC
Bryan TX
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Accurate inventory of critical spares and high movers are important to allow us to keep equipment in operation and minimize downtime: nothing worst then scheduling a planned downtime and finding that the parts required aren't physically available after reaching agreement with production and planning or worst after opening the equipment.

I've used to get stock count of critical spares and high movers done on a monthly basis. Stock count of the remaining inventory was spread over a 12 months period making it easier to manage within day-to-day schedule then doing an annual or quarterly stock count. Inventory system (SAP) can be setup to generate the monthly stock count list automatically.

Also recommend to have the count perform by employees having some knowledge of the materials to count (trades or other). This allow to detect misplaced / misidentified parts or counting kit as unit or vice versa.

Regards.,

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Charles Henault
ISPE Reliability Manager
Orica Ltd
Brownsburg-Chatham QC
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There are several areas that I would suggest.  Absolutely, daily cycle counts are mandatory.  Here's the business case.  What's one hour of asst downtime vs 1 hour of a storeroom clerk conducting a cycle count?  I used several measures for my warehousing operations.
-Inventory accuracy
-Net dollar accuracy
-Gross dollar accuracy
-Location verification accuracy
-Inventory turnover  

I honestly believe an annual physical inventory causes more harm than good.  My definition of a daily cycle count is "Quality Audit".  Are we doing the correct credits and debits.  As for ABC classifications, absolutely!  I need to manage what's important to the business.  There are several ways to use ABC classifications.  Value, Usage, Criticality, etc.

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Andrew Gager CAMA, CMRP, CPIM, CRL, CSSGB
CEO / President
Wake Forest NC
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Thank you Andrew.

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Harry Kohal
Eagle Technology, Inc.
Mequon, WI
+1-262-241-3845
414-322-4311 - mobile
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Original Message:
Sent: 02-07-2022 02:50 PM
From: Andrew Gager
Subject: Inventory Cycle Counting

There are several areas that I would suggest.  Absolutely, daily cycle counts are mandatory.  Here's the business case.  What's one hour of asst downtime vs 1 hour of a storeroom clerk conducting a cycle count?  I used several measures for my warehousing operations.
-Inventory accuracy
-Net dollar accuracy
-Gross dollar accuracy
-Location verification accuracy
-Inventory turnover

I honestly believe an annual physical inventory causes more harm than good.  My definition of a daily cycle count is "Quality Audit".  Are we doing the correct credits and debits.  As for ABC classifications, absolutely!  I need to manage what's important to the business.  There are several ways to use ABC classifications.  Value, Usage, Criticality, etc.

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Andrew Gager CAMA, CMRP, CPIM, CRL, CSSGB
CEO / President
Wake Forest NC
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For Conducting daily inventory cycle counting, RFID system should be in place instead of the ordinary Bar Code. It is going to be more easier, accurate and faster! This of course depends on your inventory size! For small size inventory, Bar Code technique is more than enough.

Regards,

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Samih Abdalazeez
CMRP

Assistance Maintenance Manager
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I'm a great believer in cycle counting.

The scope and complexity of your cycle counting process necessarily depends on the size of the operation, but I firmly believe any type of maintenance organization will benefit from cycle counting.  I recommend that the people actually using the parts should be involved in the physical counts, and in large organizations the dedicated parts inventory personnel should step back.  This gives the maintenance team a better familiarity with the parts availability and stocking system, and a "second set of eyes" to check accuracy.  Daily or weekly cycle counting (or even monthly, or twice daily, depending on the scope) will depend on the total number of counts to be completed. If possible I prefer to keep each counting session less than an hour, so no, I don't suggest "designated cycle counters".  If you have that many counts to complete I recommend using more people rather than taking more of one person's time. 

ABC divisions are completely appropriate in large, complex inventories to reduce manpower requirements without losing any of the benefit.

I sincerely hope this helps.

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Daniel K Corman, CMRP
Houston, Texas, USA
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