Skip to content
Home » Cycle counting

Cycle counting

Overview

The cycle counting process consists of three stages:

  1. Create the cycle counting warehouse work. The cycle counting work can be created either automatically or manually
    • Automatic cycle counts can be created based on threshold parameters for items or locations or by using a cycle counting plan
      • Cycle counting thresholds – when an item or location reaches a set threshold limit, cycle counting work is automatically created.
      • Cycle counting plan – can set up a plan to count a specific number and type of items for selected warehouses. This plan can be set to run automatically.
    • Manual cycle counts can be created manually for items via the Warehouse management > Cycle counting > Cycle count work by item page or for locations via the Warehouse management > Cycle counting > Cycle count work by location page.
  2. Process the cycle count – using the mobile device to perform the cycle counting work by counting items in a warehouse location and entering the quantity.
  3. Resolve differences in the counted value – after a cycle count, any items that have differences in the counted value will have a work status of Pending review. These cycle counts can then be reviewed and the difference either accepted (the stock level is adjusted accordingly) or rejected.

Alternatively, items can be counted in a warehouse location without creating cycle counting work. This process is referred to as spot cycle counting.

Examples
Cycle count thresholds

These are created in Warehouse management > Setup > Cycle counting > Cycle count thresholds. Firstly, you would specify whether this would be based on a specific quantity (1) or a percentage of the warehouse locations capacity (2). In the example below, the cycle count threshold type (3) will determine whether the value in (1) or (2) will be used. In other words, if the Cycle count threshold type is set to Quantity, when the quantity reaches zero cycle count work will be created. Likewise, when the Cycle count threshold type is set to Percentage, when the location reaches 10% of its capacity, cycle count work will be created.

You can also specify the number of days before another cycle count is created (4). If this is set to zero days,  then every time the quantity is below the threshold, the system will generate the cycle count immediately as long as there is not an unfinished count to be performed.

The next step is to select the items (5) to which this threshold rule will apply. This opens a query which can be as simple or complex as is required. In the example, this rule will apply to any products with an ABC category of A. Finally, select the locations for which this rule will apply. This opens a query which allows a query to only check certain locations. In the example, this is blank so this rule will apply to ALL locations.

Select items:

Select locations:

Cycle counting plans

These are created in Warehouse Management> Setup > Cycle counting > Cycle count plans. In the examples below, the cycle count plans have been set up to cater for ABC categories, in that, category A items will be counted every 3 months, category B every 6 months, and category C every year (2). The Maximum number of cycle counts will determine the maximum number of items that will be counted each time a cycle count plan is processed.

Similar to the Cycle count thresholds, it is possible to specify the products to which this plan applies to via the Define product query screen (3), and also the locations for which this plan applies (4).

Finally, the plan can be executed by clicking the Process cycle counting plan button (5) above. This can either be immediately by simply clicking the OK button (1) below, or scheduled by sliding the Batch processing to Yes (2) and entering a recurrence schedule.

Manual cycle counts

Manual cycle counts are created for items via the Warehouse management > Cycle counting > Cycle count work by item page or for locations via the Warehouse management > Cycle counting > Cycle count work by location page. In both options, the number of items /locations to count along with the ability to enter any further filters for items or locations can be entered before clicking the OK button to create the necessary cycle count warehouse work.

Process cycle count work

The warehouse work created by using either the automatic or manual methods above is simply an instruction to go to the location and count the stock in that location:

The cycle count work is typically processed by the warehouse workers using the mobile device. The mobile device can be configured for Guided cycle counting where the worker is typically shown the item and licence plate number to count, or Blind cycle counting where the worker needs to count a location without any guidance as to which items they should be counting.

When setting up the mobile device menu item for guided cycle counting, the System directed Direct by setting (1) should be used and in the Cycle counting button (2) the required fields to display on the mobile device should be selected (3). It is also possible to enforce the count to be entered several times in instances where the counted quantity is different from the system quantity (4).

When setting up the mobile device menu item for blind cycle counting, the Cycle count grouping Direct by setting (1) should be used and in the Cycle counting button (2) the required fields to display on the mobile device should be de-selected (3). When this mobile device menu item is used, the worker will need to scan the location, item and licence plate as well as entering the the quantity counted.

Guided cycle count mobile device menu item with the item, location and licence plate being displayed to direct the worker what requires counting:

Blind cycle count mobile device menu steps through multiple screens asking for the location, item, licence plate and finally quantity for the item being counted:

Cycle counting approval

Once the cycle counting warehouse work has been processed, the worker settings can determine whether any cycle count discrepancies will be posted immediately or whether a cycle count supervisor will need to approve the adjustments. In the work user record via Warehouse management > Setup > Worker menu, it is possible to set maximum percentage, quantity and value limits. For example, if the on-hand stock quantity in a location is 50, the percentage limit for the work user is set to 10, and the work user enters a value that is not between 45 and 55, a difference occurs, the Work status for the cycle count will be set to Pending review and a cycle count supervisor will need to accept or reject the cycle count.

If the Is a cycle count supervisor field is set to No, and all the other limit fields are set to zero, then all counting differences will need to be manually approved.

The Is a cycle count supervisor field can be set to Yes to allow this worker to reject or approve cycle counts performed by other workers. Also note that if a worker has the Is a cycle count supervisor field set to Yes, then any cycle counts that they process which have differences will automatically be stock adjusted.

A cycle count supervisor can approve the cycle count work via Warehouse management > Work > Warehouse > Cycle count work pending review. This screen shows all cycle count work that requires either accepting or rejecting. By clicking on the Cycle counting button, all the system and counted quantities will be displayed. From here the supervisor can click on Accept count or Reject count as appropriate.

Spot cycle counting

Spot cycle counting allows warehouse workers to perform a count on a warehouse location at any time without having cycle count work created beforehand. This could be useful, for example, if a worker arrives at a location which should be empty but it is full – the worker can immediately perform a spot count on this location.

The spot counting process starts by scanning a location. If Dynamics 365 is not expecting any stock to be in that location the worker will be given the option to add a new item with the licence plate and quantity.

If Dynamics 365 is expecting the location to contain stock, then depending on the configuration of the mobile device menu item, the worker will be prompted to enter the item number, licence plate and quantity of the count in that location.

Blind count:

Item and licence plate displayed:

Learning with Microsoft

Further information related to cycle counting can be found on Microsoft Learn via the URL below.

Cycle counting – Supply Chain Management | Dynamics 365 | Microsoft Learn