Use unique inventory numbers. If you have an inventory control system that manages merchandise by stock keeping units (SKUs), you’re in great shape. If not, assign a unique inventory number to each merchandise item. For example, if you have two identical watches, they should each have different tracking numbers.
Devise a number, letter, or letter/number sequence that lets you divide merchandise inventory into categories. For example, a gold chain could be ‘CH100,’ while a wedding ring could be ‘WR100.’
Receiving a piece of jewellery. Always compare the purchase invoice to the merchandise received to ensure you were shipped the correct items. Then, enter them into your inventory system along with the following details:
• description of the items;
• the date you received them;
• your cost for the items; and
• the manufacturer’s name.
Be sure inventory numbers appear on the purchase invoice when you file it, and include the number on the sales tag as well.
Selling a piece of jewellery. When you sell a piece of jewellery, consider recording the following on a three-part sales receipt:
- inventory number;
- date of sale;
- customer’s name and address; and
- selling price.
Give one part to the customer, file one for inventory-control purposes, and keep another for your accountant or bookkeeper.
Recording a change in value. If your replacement cost increases or decreases for certain items in your inventory, your insurance carrier should allow you to amend these values on the next physical inventory you provide for the purposes of developing your annual policy premium. When the market is volatile, this can be a great option to ensure your jewellery is adequately protected.
Storing inventory records. You will want to keep your inventory records for a minimum of seven years or until the inventory has been sold. If you have a manual inventory system, keep inventory control records separate from your merchandise to minimize the chance of them being stolen if you are the victim of a theft. Store inventory control records, including purchase invoices and sales receipts, in a fireproof container or safe that is not used for merchandise.
Keep copies of your two most recent annual physical inventories away from your business, such as at your home, a bank vault, or your accountant’s office. For a computer-based system, back up your files on removable media, such as an external hard drive or cloud service, and store the media at a location away from your business.