What manual stock control really costs a pet shop

Nobody loses money on stock in one dramatic go. It leaks, in five places at once, and none of them shows up as a line on your P&L. It shows up as “we’re busy but there’s never any cash”.

Here’s how to size each leak for your own shop rather than trusting anyone’s averages, including mine.

The five leaks

1. Expiry

Pet food, treats, medicines and spot-ons all carry dates. In a shop working off memory, expiry is discovered on the shelf, usually by a customer.

Size it: for one month, put everything you throw out or discount to clear in a box and total the cost price. That’s your monthly expiry loss. Most owners are surprised by a factor of two or three, because a bag written off in week one and another in week three never get added together.

2. Stockouts

The one that never gets counted, because a sale you didn’t make leaves no record.

Size it: for four weeks, keep a sheet at the till. Every time someone asks for something you don’t have, one tick and the item. At the end, multiply by your average margin. This is usually the largest of the five and the one nobody believes until they run it.

3. Dead stock

Money sitting on a shelf in things nobody wants. A pallet of a flavour that didn’t sell, sizes that don’t move, a range you backed and the market didn’t.

Size it: list anything that hasn’t sold a single unit in 90 days. Total the cost price. That’s cash you’ve already spent, sitting still.

4. Counting time

Manual stock control means someone counting, someone writing, someone typing. Usually the owner, usually after closing.

Size it: hours per month on stock admin, times what you’d pay someone to do it. Then add what you’d have done with those hours.

5. Shrinkage

Theft, breakage, staff error, mis-scans, the bag that walked out under a pram. Retail shrinkage is normally quoted at 1–2% of turnover. Without a system you cannot distinguish shrinkage from counting error, which is itself the problem.

Size it: you can’t, not accurately, until counts are reliable. That’s the point.

Add it up

Do those five for one month and you’ll have a real number for your shop. Not a number from an article. Yours.

Most independents who do this find the total lands somewhere they wouldn’t have guessed, and that the ranking surprises them. Almost everyone expects expiry to be the biggest and finds stockouts are.

Why manual methods fail specifically

It isn’t carelessness. Manual stock control fails for structural reasons:

The count is stale the moment you finish it. You counted Sunday. By Wednesday it’s fiction.

Nobody updates it during the rush. The times you most need accuracy are exactly when nobody has a hand free.

Expiry needs looking-ahead, and a sheet only looks back. A spreadsheet tells you what you have. It doesn’t tell you what dies in 30 days.

Two people means two versions. The moment more than one person touches the stock sheet, you have a reconciliation problem instead of a stock figure.

It can’t answer the question that matters. Not “how many do I have” but “what should I order, and how much”. That needs sales velocity next to stock level, and no manual system carries both.

What to fix, in order

1. Get the count honest. One physical count, done properly, with a system to hold it. Everything else depends on this.

2. Put dates on the dated stock. Food, treats, medicines. This alone usually pays for the software.

3. Set reorder points on your top 20 lines. Not everything. The twenty items that make most of your money. Reorder point = how many you sell in the time it takes your supplier to deliver, plus a buffer.

4. Start recording stockouts. Even after the system is in, keep asking. A stockout is invisible to software too if nobody records the request.

5. Review dead stock quarterly. Anything at 90 days with no movement gets discounted, bundled or returned. Cash out of a shelf beats margin you’ll never realise.

6. Only then worry about shrinkage. Once counts are trustworthy, the gap between expected and actual is real information. Before that, it’s noise.

What a system actually changes

Not magic, just three things done automatically:

• Stock drops as you sell. The count is current because billing updates it, not because someone remembered.
• The system looks forward. Expiry dates and reorder points generate warnings before the problem, not after.
• You can see velocity next to stock. Which is the only way to order the right quantity.

In Fretso’s retail module, every invoice and every dispensed prescription takes stock off the shelf, low-stock items surface on the dashboard, and purchase orders are raised against suppliers in the same system that recorded the sale. The reports put movement next to stock level so ordering is a decision rather than a guess.

Be sceptical of the payback claims

You’ll see vendor pages claiming specific recovery figures. Treat them the way you’d treat any number with no shop behind it.

The honest version: measure your own five leaks for a month first. That gives you a real baseline and a real target. If the software doesn’t move it inside two quarters, something is wrong with how it’s set up, and you’ll have the numbers to prove it either way.

Quick answers

How much stock loss is normal for a pet shop? Retail shrinkage is typically quoted at 1–2% of turnover, but expiry and stockouts usually cost an independent pet shop more than theft does. Measure your own before assuming.

What’s the fastest fix? Expiry alerts on dated stock. It’s the leak that is easiest to eliminate almost entirely.

Do I need a stock take before going digital? Yes. One accurate physical count, then the system maintains it. Starting from a wrong number just automates the wrong number.