What Is a Cycle Counter? (With Definition, Types, and Tasks)

By Indeed Editorial Team

Published May 29, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Cycle counting is a process involved in inventory management that counts stock as it moves through the supply chain. A cycle counter is a professional that enacts these inventory control methods to reduce breakage and increase efficiency. Understanding what these supply chain professionals do can help you determine if this career aligns with your goals. In this article, we define the role of a cycle counter, list the different counting types, explore regular job duties, explain where cycle counters work, and detail how to become a professional in this field.

What is a cycle counter?

The answer to "What is a cycle counter?" is that it's an inventory control method that determines the accuracy of the records of products that are in stock. Most warehouses employ cycle counting as a method of reducing loss and improving supply chain processes. The process of cycle counting is an ongoing audit procedure, so the professional is responsible for monitoring the input and output data for that system. It relies on set processes to repeat a series of checks on inventory subsets. Cycle counters use this information to create reports on inventory processes and provide them to supply chain supervisors.

Types of cycle counters

Cycle counting is a process that refers to any perpetual audit of inventory. Unlike physical inventory tracking, these approaches provide a non-invasive way to monitor the status of your inventory. There are three main types of cycle counters, including:

Opportunity-based counting

This method of cycle counting tracks your inventory at every change in its status. Cycle counters monitor changes and input them into a tracking system. For example, when a warehouse processes an incoming delivery, the counter adds that to the total inventory. These counts inform decisions on purchase orders, loss prevention methods, and contracts with shipment companies. There are many changes to inventory status across the supply chain, including:

  • Purchase orders from suppliers

  • Outgoing shipments from the manufacturing facility

  • Transfer of goods between shipment companies

  • Storage and warehousing of goods

  • Product expiration dates

Process control counting

This auditing protocol empowers the cycle counter to isolate sections to count based on inventory reports. In situations with less human resources, process control counting lets you focus on specific products instead of spending time counting items that have low turnover. Inventory reports highlight issues in the supply chain, such as damage to the product while moving the inventory or waste from expired products because of a first in, last out method. The cycle counter implements inventory control processes to respond to those issues and improve warehouse management methods.

An example of process control approaches is a cycle counter in a warehouse dedicating a section to wood products that ship in bulk at sparse yet regular intervals. By separating these from high turnover items, the cycle manager can focus on tracking inventory with a historically higher record of breakage. Because of the authority of cycle counters that rely on process control methods, it is usually a mid- to senior-level position.

Related: Specific Identification Method (With Benefits and Examples)

ABC analysis

One of the most prevalent types of cycle counting is ABC analysis, an approach that relies on a class structure to categorize and count inventory. High-priority products are class A, with lower-priority inventory following in alphabetical order. The cycle counter tracks class A items at a higher frequency than class B or C products. To determine the rate at which it's best to count each class of inventory, logistics professionals use one of the following approaches:

  • Usage metrics: The usage method emphasizes the priority of products based on the purchase frequency as a way of ensuring sufficient stock to fill purchase orders. This approach assigns the items that ship more often to a higher class to facilitate the movement of goods while minimizing damage and loss.

  • Pareto principle: ABC analysis uses the Pareto Principle to classify items based on the monetary value of the products. The higher the revenue of a product, the more frequently the cycle repeats and the inventory control professional counts the products.

  • Hybrid method: Cycle counters often use a hybrid method that combines usage metrics and the Pareto Principle to determine how to categorize inventory. A combination of the highest turnover and greatest revenue shows the portion of inventory control efforts a class of products receives.

Related: What Is Warehouse Logistics and Why Should You Use It?

Cycle counter job duties

Understanding the answer to, "What is a cycle counter?" involves learning the responsibilities of employees in this role. Professional cycle counters have many job titles, including logistics coordinators and inventory control managers. The common factors between each role are the position's duties, including:

  • Developing, monitoring, controlling inventory tracking practises, and improving accuracy

  • Maintaining inventory identification and location programs using technology such as RFID tracking and IoT connections

  • Completing incident reports and inspections in the event of product damage

  • Auditing inventory transactions using cyclical approaches and writing reports on the data

  • Investigating inventory inconsistencies and developing solutions to issues in the supply chain

  • Physically counting inventory to ensure the accuracy of inventory reports firsthand

  • Coordinating deliveries and determining the accuracy of shipment quantities

  • Improving warehouse efficiency by improving storage and the flow of goods

  • Strategizing and creating solutions based on issues with inventory control processes

Where do cycle counters work?

Cycle counters work in different environments, depending on their level of experience and education. Because inventory management requires physical products, cycle counting professionals work at major junctures in the supply chain. Some work in factories or other manufacturing facilities to track production quantities. Others work in warehouses or transloading facilities where companies store products before fulfilling orders. Cycle counters can work anywhere that routinely processes inventory, including grocery stores, industrial supply retailers and storage facilities. These professionals manually check inventory regularly, though they mostly work at a desk filing reports, and tracking inventory digitally.

How to become a cycle counter

A career in inventory control and logistics provides significant opportunities for growth. Becoming a cycle counter involves several steps, including:

1. Earn a relevant degree

Cycle counting is a component of various inventory control and supply chain positions, some of which require a bachelor's degree for an entry-level position. Other positions that focus exclusively on the tasks of counting and reporting only require a high school diploma. For a position with broader responsibilities, there are several degrees that apply to this field, including supply chain management, transport and logistics, or a broader degree, such as business administration.

The courses you take during your undergraduate degree equip you with relevant information about inventory control. This includes tracking software, best practices, shipping regulations, and inventory control methods, such as cycle counting. A bachelor's degree provides the fundamental knowledge to work in inventory management, though you can gain more specific education with a master's or doctoral degree.

Related: 9 Supply Chain Management Degree Jobs (With Salaries)

2. Develop necessary skills

Successful professionals in cycle counting have both knowledge and essential soft skills, such as attention to detail and focus. Counting requires patience, diligence, and the ability to perform repetitive mental tasks over long periods of time. Strength in mathematics makes it easier to complete calculations necessary to inventory control, while computer skills enable you to work with warehouse management software. While an education establishes knowledge of cycle counting, it works best when the logistics professional is creative and strategic.

3. Gain work experience

Working in inventory control gives you experience with cycle counting from a procedural standpoint. Entry-level positions in logistics involve manually counting products and filling out reports. By working in a warehouse or transloading facility, you can gain practical experience that can inform strategic decisions you make later in your career. Keep a record of your experience with cycle counting and other logistical tools to develop your resume. Experience in the field substantiates your work ethic and proves that you have professional experience in inventory control.

Related: How to Create an Effective Warehouse Resume (With Tips)

4. Continue your professional development

Best practises in the field of logistics evolve, requiring the cycle counter to update knowledge and skills regularly. Supply chain professionals can improve employability by remaining current with warehouse management and inventory control software. By maintaining a professional network, attending seminars, and taking courses in supply chain and inventory control topics, you can remain competitive in the industry.

5. Grow your supply chain career

Once you gain sufficient experience and knowledge, you can pursue career advancement in logistics or management. Inventory control can lead to many careers, including work consulting for different clients and providing solutions to various supply chain issues. Inventory control is essential to business success, and companies that deal with physical commodities place a lot of importance on the supply chain. As a result, cycle counters can develop rewarding careers that support an operational supply chain.

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