Retail guides
Purchasing and receiving
Inventory can be wrong before the product ever reaches the shelf. You ordered 24, the vendor delivered 20, somebody signed for 24, and from that moment every count, every reorder and every margin figure on that line is built on a number that was never true.
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What is the difference between purchasing and receiving?
Purchasing is what you asked the vendor for: the products, the quantities, the pack sizes and the costs you expected to pay. Receiving is what actually arrived and what it actually cost. Inventory accuracy lives in the gap between them, and a store that never compares the two is running its counts on its purchase orders rather than on its deliveries.
Most inventory investigations start at the shelf and work backwards. They usually end at the back door, on a delivery nobody checked.
- What was ordered and what arrivedA short delivery signed for in full is a permanent error in that line.
- What it was supposed to costA vendor cost change nobody noticed becomes a margin problem months later.
- Who is allowed to receiveReceiving changes inventory, which makes it a permission rather than a task.
- What the barcode is forScanning a delivery in checks it against the order instead of against somebody’s attention.
A process nobody follows is not a process. The system can make receiving quick and checkable; whether it happens at the back door on a Friday afternoon is a management question, and worth being honest about before anything is bought.
The receiving workflow
What should be compared during receiving
Four comparisons, each of which catches a different problem, and none of which takes long once it is part of the routine.
Quantity against the order
Purchase ordersWhat was ordered against what the driver actually brought, line by line, before the paperwork is signed.
Cost against the order
Purchase ordersWhat the line was expected to cost against what the invoice says, so a change is a decision rather than a surprise.
The product itself
Barcode scanning and labelsScanning what arrived checks it against the order rather than against whoever is at the back door.
What reaches the shelf
Retail pricing and labelingReceived stock priced and labeled before it goes out, so the shelf and the register agree from the start.
Who did it
Cashier and cash controlReceiving recorded against the user who entered it, which is what makes a wrong number answerable later.
What the count says afterwards
Stock takeA count is where a receiving problem finally shows up. Catching it earlier is the whole point.
Common receiving errors, and what they cost
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The delivery is signed for without being checked
A short delivery becomes a permanent error, and the vendor has no reason to fix it.
Receiving against the purchase order, with the shortage identified while the driver is still there.
Purchase orders -
A vendor cost change goes unnoticed
The margin moves quietly and nobody can say when it started.
The expected cost is on the order, so a change is visible at receiving rather than at the month end.
Retail reporting -
Stock is received into the wrong item
Two lines are now wrong, and one of them looks fine.
Scanning what arrived resolves it to the item record rather than to a description somebody read.
Barcode scanning and labels -
Anybody can receive and adjust
When a number is wrong there is no way to ask who changed it.
Receiving and adjustment are permissions, recorded against the user who used them.
Cashier and cash control -
Received stock goes out unpriced
The shelf and the register disagree from the first sale.
Pricing and labeling are part of receiving rather than a separate job that happens later, or not at all.
Retail pricing and labeling
Purchasing and receiving questions
Do I have to count every delivery?
Every delivery gets checked against its order; that is different from counting the store. On a big delivery a store may check high-value lines and spot-check the rest, which is a policy decision worth making deliberately rather than by default.
What if the invoice and the delivery disagree?
That is exactly what receiving against the order is for: the discrepancy is visible at the back door, while there is still somebody to raise it with.
Can scanning speed this up?
Yes, and it changes what is being checked: scanning resolves what arrived to the item record rather than to a description somebody read off a box.
Who should be allowed to receive?
Receiving changes inventory, so it belongs to named people with the permission, recorded against them. Which people is your decision; that it is a permission rather than a habit is the part worth insisting on.
Does this get harder with more than one store?
Yes. Ordering, receiving and transfers across locations add a layer, and what that needs is settled against the stores you actually run rather than assumed.
Will software fix our receiving?
No. Software makes a good process fast and checkable, and makes a missing one visible. If nobody checks deliveries today, the first thing to change is the process, and we would rather say so before you buy anything.
Is receiving one of the reasons your inventory is wrong?
Tell us how deliveries are checked today and what your counts look like, and we will say where the gap most likely is before recommending anything.