Stock Taking – Perpetual V Annual Stocktake

Perpetual Stock Taking Compared to Annual Stocktake: Which One Is Better?

Are you looking for an efficient way to manage your inventory? At Fresh Logistics we stocktake all the time. Then you might have come across the terms Perpetual Stock Taking Compared to Annual Stocktake. Both of these methods have their advantages and disadvantages, but which one is better? In this blog, we\’ll compare perpetual with annual stock taking, and we\’ll explain which method might be better for your business.

\"PerpetualWhat is Perpetual Stock Taking?

Perpetual stock taking is a continuous process of counting and recording inventory levels in real-time. This means that every time a product is received, sold, or moved, the inventory levels are updated immediately. With perpetual stock taking, you always have an up-to-date view of your inventory levels, and you can quickly identify any discrepancies.

What is Annual Stocktake?

Annual stocktake is a method of inventory management where a physical count of inventory is taken once a year. During this process, all items in stock are counted, and the inventory levels are adjusted accordingly. This method is often used by businesses to reconcile their inventory levels and identify any discrepancies.

Differences Between Perpetual Stock Taking and Annual Stocktake

Frequency of Counting

The most significant difference between perpetual and annual stocktake is the frequency of counting. Furthermore, different people are counting the stock several times a day which eliminates a factored mistake being recorded.  As the name suggests, perpetual audit is a continuous process of counting and recording inventory levels, while annual stocktake is only done once a year.


Another difference between perpetual and annual stocktake is accuracy. With perpetual, you always have an up-to-date view of your inventory levels, which makes it easier to identify discrepancies and fix them. Annual stocktake, on the other hand, only gives you a snapshot of your inventory levels at a specific point in time, which may not be accurate throughout the year. Furthermore, a mistake in recording the stock will sit on the books for a year.


Perpetual requires an investment in technology, such as barcode scanners, inventory management software, and other equipment. The cost of these tools have come down dramatically but still can be significant, especially for small businesses. In contrast, annual stocktake only requires a one-time investment in labour, such as hiring temporary staff to count inventory.

Advantages and Disadvantages of Perpetual Stock Taking


  • Real-time view of inventory levels
  • Increased accuracy
  • Improved efficiency
  • Reduced labour costs
  • Improved customer satisfaction


  • High initial investment in technology
  • Requires consistent updates and maintenance
  • Possible data inaccuracies due to human error

Advantages and Disadvantages of Annual stock taking


  • Easier to organise and execute
  • Less expensive upfront costs
  • Provides an accurate snapshot of inventory levels


  • Only provides a snapshot at a specific point in time
  • Can be disruptive to business operations
  • Requires more labour

Which Method is Better when stock taking?

The answer to this question depends on the specific needs of your business. If you have a small business with a limited inventory, annual stocktake might be sufficient. However, if you have a large business with a high volume of sales, perpetual stock taking is likely the better option. This method allows you to track inventory levels in real-time, which helps to reduce the risk of overstocking or stockouts. It also improves the accuracy of your inventory records, which can help you make more informed business decisions.

Perpetual can be expensive to set up, but the long-term benefits are often worth the investment. It helps to reduce labour costs and can improve customer satisfaction by ensuring that products are always in stock.

Another advantage of perpetual is that it helps to identify discrepancies and minimise the risk of theft. it\’s easier to detect when products are missing or have been stolen. This can help to reduce losses and increase profits.

To sum up, both perpetual and annual stocktake have their advantages and disadvantages. The best method for your business will depend on your specific needs and budget. However, if you want to improve accuracy, reduce labour costs, and track inventory levels in real-time, perpetual is likely the better option.


Inventory management is a critical component of any business, and choosing the right stock taking method can have a significant impact on your bottom line. Perpetual and annual stocktake are two popular methods, each with its advantages and disadvantages. By understanding the differences between these two methods, you can make an informed decision about which one is best for your business.

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