When stock breaks or spoils inside your own shop

Write it off the same day, in the same place you write everything else, with one word saying why. Damage inside your own shop is real money leaving, but because nobody owes you for it, most shops never record it at all. What is never recorded cannot be reduced.

Nobody owes you for this one

A bottle slips off the shelf while you are reaching past it. A sack of flour tears at the bottom and half of it goes into the dust. A carton at the back has been sitting where the roof leaks, and the packets inside have gone soft.

You sweep it up, you feel annoyed for ten minutes, and then a customer comes and the whole thing is finished. Nothing gets written, because writing is something you do when somebody owes you money, and here nobody does.

That is the reason this particular hole never closes. Every other loss in a shop has a person attached to it. A customer who does not pay has a page. A supplier who short-counted has a bill you can wave. Breakage has nobody, so it has no page, and after six months of small unrecorded losses your stock count is wrong, your profit looks better than it is, and you have no idea which part of your shop is eating the money.

What it costs, honestly

Put an amount on it once and the habit becomes easy to keep.

Say a shop loses this much inside its own walls each month

Two bottles and a jar off the top shelfRs 900

A torn sack, half of it swept awayRs 1,400

Packets gone soft in the damp cornerRs 1,100

Snacks past their date at the backRs 800

Lost with no customer and no argument, over a yearRs 50,400

Sit with the last row for a moment. That is money you earned, paid for, carried to the shop, and then lost inside your own four walls, without a single argument or a single bad customer.

And it is not spread evenly. In almost every shop, most of the damage comes from two or three places: one shelf that is too high, one product that leaks, one corner where the damp sits. You cannot see those two or three places unless you write the losses down, because in your memory every breakage feels like bad luck. On paper, bad luck turns out to have an address.

The four kinds, and why they need separating

They look like one problem and they are four, with four different answers.

Four losses that look like one

What it really isWhat actually fixes it

BrokenWhat it really isSomething fell, slipped or was crushed while it sat in your shop.What actually fixes itChange where it sits. Heavy and fragile go low, not high.

SpoiledWhat it really isIt lasted less time than it took to sell, or the damp reached it.What actually fixes itBuy smaller quantities of the slow lines and keep them dry.

Arrived damagedWhat it really isIt was already cracked, wet or short when it came off the van.What actually fixes itCount at the door. It goes back on his sheet before he leaves.

Simply missingWhat it really isNothing broke. The item is not on the shelf and not sold either.What actually fixes itA different problem with a different answer, and never an accident.

Breakage is about how the shop is arranged. Spoilage is about how fast a thing sells against how long it lasts, which is the whole subject of catching things before they pass their date in a different form. Damage that arrives already damaged is a supplier conversation, not your loss at all. And shrinkage, where the item is simply not there, is the one that is never really an accident, and it has its own article in when stock goes missing and nobody knows how.

If all four are entered as one line called loss, you will treat all four the same way, and the only tool you have left is being more careful, which is not a tool at all.

Write it as a movement, not as a feeling

Here is the whole habit, and it takes longer to read than to do.

When something is damaged, reduce the count of that item and put one word beside it saying why. Broken. Leaked. Damp. Rats. Returned to supplier. That is it. Not at the end of the week, not when you get around to it, but at the moment you sweep it up, because that is the only moment you still remember which item and how many.

The reason this matters more than it sounds is that a stock count is a promise. It says: this many packets are on the shelf. The moment a broken one is swept out without being deducted, the promise is false, and every decision you make from that count afterwards is slightly wrong. You reorder late. You tell a customer you have it when you do not. Your buying rate for the whole line quietly stops matching reality.

In Wasoolo the count is reduced with the reason attached, so at the end of the month the shop can show you what was lost and to what. On paper, a single column at the back of the notebook, one line per incident, does the same job. What must not happen is that it lives only in your head.

Where the damage actually happens

Once you have a month of these lines, read them together. You will find that they cluster, and the clusters tell you exactly what to change.

What a month of loss lines usually tells you to change

• Glass and liquids move to a shelf you can reach flat-handed
• Sacks come off the floor onto a wooden pallet or bricks
• Nothing food-related is stored against the wall that gets wet
• The slow-selling lines get bought in the smallest pack you can
• Newest stock goes behind the older stock every single time
• The repair you keep postponing gets priced against three months of loss

Almost none of these fixes cost money. Moving glass to a lower shelf costs nothing. Putting the sacks on a wooden pallet instead of the floor costs one pallet, once. Selling the slow line in smaller packets costs a little effort and saves the whole loss. This is the rare part of running a shop where a small change genuinely ends a recurring cost.

The one fix people avoid is the honest one about the leaking roof or the damp corner, because it costs real money to repair. Write down what that corner destroys over three months and put the two numbers side by side. Very often the repair is cheaper than the damp, and it was only being postponed because nobody had ever added the losses up.

Who pays when your helper breaks it

This comes up in every shop, and getting it wrong costs more than the item.

Decide the rule before it happens and say it out loud when you hire. Ordinary breakage while working is the shop's cost, not his. If a man carrying a crate is going to lose a day's pay for a slipped hand, he will stop carrying crates quickly, or worse, he will hide the breakage and your count will go wrong on top of the loss.

What is not ordinary is carelessness that repeats, and that is a conversation about how he works rather than a deduction from what he earns. Deducting money quietly is the fastest way to teach somebody to hide things from you, which is the same lesson in keeping a helper's pay straight: a person who fears the record will stop feeding it.

The exception everybody accepts is deliberate misuse, and that is rare enough that it does not need a policy. It needs a decision about whether you keep employing him.

What to do about goods that arrived broken

Some of what you sweep up was never your fault, and that portion should never sit in your loss column.

Open the delivery while the man is still there and count it in front of him. Anything cracked, wet or short goes back onto his sheet before he leaves, because after he leaves it is your word against a delivery note, and you will lose that. It is the single highest-value five minutes in the whole buying process, and it belongs to the same habit as keeping the shelf count right without counting all day.

For a line that arrives damaged again and again, the number is your argument. Going to a supplier and saying his packing is bad gets you a shrug. Going to him with four dates and four amounts gets you either better packing or a better rate, and if it gets you neither, you have just learned something useful about whether that supplier deserves all of your buying.

Common questions

Should damaged stock be counted as an expense or as a stock reduction?

Reduce the stock, and let the cost land where your shop already counts the cost of goods. If you enter it as a separate expense and leave the count untouched, you have recorded the money twice and the shelf still shows packets that are not there. The count on the shelf and the count in the record must agree first; everything else follows from that.

What if the item is only slightly damaged and can still be sold cheap?

Then it is not a loss, it is a lower rate, and it should be written that way. Reduce nothing from the count, sell it at the reduced price, and note why the price was different so that your average rate for that line does not look mysteriously bad later. A dented tin sold at a discount to somebody who does not mind a dent is a far better outcome than a dented tin thrown away out of pride.

My losses are tiny. A packet here, a bottle there. Is this worth the trouble?

The trouble is one word a day, so almost nothing is too small to be worth it. The value is not in the individual line, it is in the pattern that only appears when thirty small lines sit together. Nobody can see from memory that the top shelf costs them a certain amount every month, and everybody can see it from a page.

Should I tell the customer when an item is damaged, or just replace it quietly?

Replace it without argument and say plainly what happened. A customer who is handed a fresh packet and told the first one was faulty tells other people about your shop; a customer who is handed a fresh packet with an awkward silence assumes you tried something. The replacement costs you the item either way, so take the version that buys you something.

Rats and damp are ruining my stock but the shop is rented. What can I do?

Measure the loss for two or three months and take the number to the owner, because a landlord argues with a complaint and listens to an amount. Meanwhile, raise everything off the floor, move food away from the wet wall, and keep the worst-affected lines in the smallest quantities you can buy. You cannot fix the building, but you can stop storing your most valuable goods in the part of it that eats them.

How do I know if my damage is high or normal?

There is no useful outside number to compare yourself against, and anybody who gives you one is guessing. Compare yourself against yourself. Write the losses for a month, make the two or three obvious changes, and write them for another month. If the number falls, the changes worked. That comparison is worth more than any general figure, because it is about your shelves and your building.