Helpful Tips on How to Conduct a Physical Inventory Count

For any retailer, inventory is one of the biggest expenses — and with so much money tied up in stocking the right products, you'd think accuracy would be a top priority. But the reality is, the average retailer’s inventory accuracy is only about 66%. That means a lot of product is going unaccounted for.

As a fabric store owner, managing everything from massive bolts of fabric to tiny knitting needles can make inventory counts feel like a daunting spring cleaning session — one where you’re not even sure where to start.

This blog will walk you through how to count inventory in your fabric shop, offer practical tips for staying organized, and highlight tools that can make the whole process a lot easier.

Why You Need To Count Inventory

Relying solely on what a purchase order says and subtracting your sales numbers can leave you with inaccurate figures. For fabric stores, this can mean thinking you have plenty of popular fabrics on hand, when in reality, they're low in stock.

Purchase orders can have errors, you might deal with retail theft, or there could be mistakes when scanning products at the register. Additionally, fabrics may get lost or misplaced during store remerchandising or when you're rearranging displays.

Should you just let that money disappear? Absolutely not. Regular inventory counts are key to keeping your stock accurate. Whether it’s a bolt of premium cotton, a roll of upholstery fabric, or a basket of sewing notions, you need to know exactly what’s on your shelves. By conducting physical counts, you guarantee that your records match what’s actually in your store, and you can catch discrepancies that might otherwise go unnoticed.

How Often Should You Count Your Fabric Store Inventory?

In reality, you can count your inventory as often as you need to. The frequency of inventory counts depends on your store's size and how quickly products move off the shelves. Here’s a basic guideline:

Monthly or quarterly: If your fabric shop has a high turnover rate, especially for trendy prints or seasonal fabrics, counting your inventory on a monthly or quarterly basis will help keep your records accurate and up to date.
Annually: Smaller stores or those with slower turnover may get by with one annual count, but should still conduct occasional spot checks to make sure everything is where it should be.

Skipping regular physical counts can result in stockouts, overstocking, shrinkage (especially with popular fabric lines), and missed sales opportunities. Regular counts help prevent these issues and keep your operations running smoothly, ensuring you’re always in control of your inventory.

7 Tips for How To Count Inventory in Your Fabric Shop

Here are our top tips for conducting an effective inventory count in your fabric store.

1. Plan Ahead

Planning ahead is key to keeping your inventory count smooth and stress-free. Without a solid plan, you can end up wasting time, getting confused, or even missing items — which defeats the whole purpose of counting inventory. Here some tips for the planning phase:

Pick a low-traffic time: Try to schedule your count when the store is least busy so you're not interrupted by customers. Many fabric shops do their counts at the end of the day, after hours, or during a slower season. If closing your shop isn’t an option, pick a time during your off-hours when things are quiet.
Organize your space: Before the big day, get your fabric bolts, notions, and all your other supplies in order. Make sure everything is in its proper place and clearly labeled. A tidy stockroom will speed up the process and help avoid mistakes when you're counting.
Create a layout map: Draw up a simple map of your store that shows where all your shelves, racks, and storage areas are located. This helps you keep track of what’s already been counted and ensures you don’t skip any sections. Number each section and make sure there’s an inventory sheet ready for each area.

2. Gather the Right Tools and Supplies

To keep things running smoothly and avoid mistakes, make sure you’ve got everything you need. The tools you’ll use depend on your store size and whether you prefer going old-school with paper or using digital tools. Here are some tools you’ll need:

Use inventory sheets or digital tools: Use sheets to list each item with details like SKUs, descriptions, and locations. If your point of sale (POS) system has inventory tracking, you can track counts in real time. For smaller stores, simple paper sheets can work just fine.
Have clipboards, pens, and barcode scanners ready: Get your team set up with clipboards to hold those inventory sheets, pens for marking counts, and barcode scanners (if you’ve got them) to speed up the process. Scanning can reduce errors and make counting fabric bolts a whole lot quicker.

3. Assemble Your Counting Team

If you run a small shop, your staff might be able to handle the entire count — but for bigger stores, you probably need extra hands. Think about recruiting reliable employees, family members, or even friends who know their way around your fabrics. For the count to go as planned, keep these things in mind:

Assign roles: Make sure everyone knows what area they’re covering and has the tools they need. Pair up less experienced staff with the pros to make sure everything’s counted accurately.
Prepare for the count: Have everyone arrive about 10 minutes early and make sure there are snacks and drinks to keep them fueled. A happy, well-fed team is more likely to stay focused and get things done faster.

4. Count the Fast-Moving and High-Priority Items First

Fabric stores usually carry a ton of different fabrics, patterns, and notions. So, it’s smart to start with your fast-movers — the items that sell quickly or are most important to your inventory. This includes your bestselling fabrics or things you know customers are always asking for. Here’s how you can approach it:

Focus on bestsellers: If you have a popular fabric line that’s flying off the shelves, count it first and update the inventory right away. This way, you can restock when needed and avoid running out of your top-selling items.

5. Break Up the Count Into Smaller Sections

Trying to count everything at once can be overwhelming. Break it down into manageable chunks. Assign small teams to different areas or categories based on the map you created earlier. Here’s how to stay on track:

Use a system: Start in one corner of the store and work your way around, whether you go clockwise or counterclockwise. This helps you track your progress and makes sure no shelves are skipped.

6. Double Check for Discrepancies and Adjust Your Records

Once you’ve finished counting, it’s time to compare your physical count with the records. Go through the numbers with your team and look for any discrepancies. If something doesn’t match, go back and recount those items to make sure the numbers are right. Here’s what to do next:

Track discrepancies with your inventory system: Update your records as you go, making adjustments right after the count. Your inventory management system can help ensure your physical count matches up with your digital records.

7. Decide What To Do With Broken, Returned, or Scrap Inventory

Every fabric shop has damaged, returned, or leftover stock. It’s important to handle these correctly to keep your inventory organized and accurate. Consider these ideas:

Don’t forget to put returned items back into inventory: If a customer returns something, like a bolt of linen, make sure you immediately update your count to reflect the return, so your numbers stay correct.
Get creative with damaged or unsellable fabric: If you have damaged inventory, decide whether to return it to the supplier, sell it at a discount, or donate it. For scraps or leftover fabric, consider creating small sample packs for customers or selling the remnants at a discount. This helps keep your stock fresh and reduces waste.

Just like the fabric you stock, this can always be adjusted to fit what works for your store. Even though it seems tedious, it’ll save you money in the long run. To speed up the process, invest in a POS system designed specifically for fabric stores.

Speed Up Inventory Counts With Like Sew

Counting inventory manually can be a real headache, especially in a fabric store where you're managing everything from fabric bolts to sewing notions. If you're wondering how to count inventory more efficiently, Like Sew can make the process faster, simpler, and more accurate.

Like Sew offers features that simplify your inventory counts. Its inventory count integration automatically syncs your stock levels in real time, so you don’t have to make manual updates. This keeps your records accurate and minimizes discrepancies.

You can also use portable barcode scanners to quickly import inventory data, speeding up the process and reducing human error. If you need to make updates on the go, Like Sew allows you to add inventory directly from your mobile device, whether you’re in the back room or out on the floor.

Plus, serialized inventory helps you track individual items with precision, which is especially useful for high-end fabrics or small notions.

These features save you time, reduce mistakes, and keep your inventory up to date — making it easier to manage your store. By simplifying inventory counts, Like Sew gives you more time to focus on what matters most — running your business.

Ready to make inventory management easier? Schedule a free demo today.

How To Count Inventory: 7 Tips & Tools for Sewing Stores