Perpetual Inventory Control

What is perpetual inventory control?

Perpetual inventory is a technique which is adopted by the organizations to record the sales and purchases of the items in inventory. The recording of information is usually done with the help of a digital management system. Due to a lot of benefits of perpetual inventory control, many businesses prefer using it.

A perpetual inventory control is a method used by various firms to keep track of their inventory. In this method every time a product or good is received by the company, or sold to the customer, it automatically updates the inventory list.


This method is a bit on the expensive side but is mostly preferred by large companies and stores to keep track of their inventory.

A perpetual inventory control doesn’t require inventory to be counted physically but technology takes care of that and maintaining that technology is a necessity.

What are the benefits of perpetual inventory control?

The key benefits are

  1. The perpetual inventory control method makes it easier for a business to prepare a balance sheet. In this way, it can easily keep track of profits and losses of the business across the year. The profit and loss account can also be created easily with the help of perpetual inventory control system.
  2. The perpetual inventory control system ensures that the issuance of material and the retail store is managed on regular basis. In this way, the business saves itself from buying the material which is no longer in use. The amount of investment to be made in a business is reduced to a great extent and the expenses related to storage are also minimized.
  3. A company is required to have more appropriate purchase policy that enables it to when the inventory will need the specific product.

Perpetual inventory control also enables the storekeeper to avoid the unnecessary locking up of the stock. This makes the store have an adequate amount of stock. The storekeeper can easily detect the theft when everything in the inventory is monitored on regular basis.

For a perpetual inventory control, many stores use tag system which scans the barcode on a product every time it is sold or it can also be used to track the date and time exactly of when the product was sold. For inventory purposes, scanning is done which automatically updates the list of the software that these products have just been brought in the store on this date and at this price.

The perpetual periodic table saves a lot of time and physical labor that would otherwise go into hand counting all of the inventory. This method boosts effectiveness and efficiency to the fullest which paves way for more profit and lesser money spent on useless inventory purchases and spoilage. It also gives out instant information to the authorities and keeps a check and balance to ensure that no inventory is stolen or misplaced.

What is the purpose of perpetual inventory control?

The perpetual inventory control is used to ensure the efficient and appropriate control over the entire inventory system. Many businesses like to have a proper control of the store’s inventory so that they can increase the productivity of the store.

Moreover, it also ensures that the store’s performance is up to the desired standards. When a company faces a minor loss, it can exercise the strict perpetual inventory control. In this way, it can take some steps to compensate the loss and control the wastage of inventory item.


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