The goal of a physical inventory process in retail is to maintain accurate stock records. This process involves counting and verifying the actual inventory on hand and comparing it to the inventory records maintained in the system. Accurate stock records are essential for various operational aspects of retail, such as ensuring that there is enough inventory to meet customer demand, preventing stockouts, and minimizing excess inventory which can lead to markdowns or losses.
Maintaining accurate stock records aids in better decision-making regarding purchasing, pricing, and promotional strategies. It also helps in identifying discrepancies which could indicate issues such as theft, administrative errors, or stock mismanagement. Consequently, this leads to improved financial performance and operational efficiency within the retail business.