Periodic inventory is a method of keeping track of inventory levels where physical counts are only conducted on a periodic basis, such as once per month. This can make it more difficult to track real-time changes in inventory levels but can be less labor-intensive than perpetual inventory methods.
On the other hand, perpetual inventory is a method of keeping track of inventory levels where physical counts are conducted regularly, such as every time a part is used or removed from stock. This provides more accurate information about current inventory levels but can be more labor-intensive than periodic methods.
There’s also cycle count, which is a hybrid of the two methods. Cycle counting involves physical inventory counts being conducted on a regular basis but not for every single item in stock. This allows for more frequent inventory checks without the same level of commitment as perpetual inventory methods.