Counting losers is a tool for evaluating the bidding strength of your hand derived from the shape and not just the points.
A good fit is when your hands share at least 8 of a suit.
The likely maximum tricks to be won is governed by how many losers there are in both hands. If you and your partner know how many losers each of you have, the level of contract in any given suit can be found.
Losers are defined as the AKQ missing in the suits in your hand. Counting all the missing honours in each suit up to the number of cards in that suit gives your total losers.
A suit of three or more with no A, K or Q counts as three losers.
A suit of two with no A, K or Q counts as two losers.
A suit of one would be one loser unless it was a singleton Ace.
A void suit would count as no losers.
If the responder has 4 cards in the opener's suit the loser count can begin.
The calculation formula is:
18 minus (openers' losers + responders' losers) equals the maximum level of a contract in an agreed suit.
The calculation assumes in the first instance that an opener has 7 losers and the responder has 9 losers.
i.e. 18-(7+9)=2. The maximum level is 2.
However if the responder has 8 losers, 3 can be bid in the agreed suit.
i.e. 18-(7+8) = 3. The maximum level is 3.
If responder has 7 losers then 4 can be bid in the agreed suit.
i.e. 18 - (7+7) = 4. The maximum level is 4.
After the response, the opener knows the number of losers in partners hand and can add her own losers. If the total of losers is 14 or less then game in a major suit must be bid.
i.e. 18-(6+8)=4 Or 18-(9+5) = 4
If the total losers are 12 or less then Blackwood can be used to evaluate a slam.
If there is a fit in a minor suit, counting losers is less valuable because making game requires 11 tricks. If responder has a fit with opener's minor suit it is often better to explore NTs.
NB. COUNTING LOSERS ONLY APPLIES WHEN THERE IS A FIT IN AN AGREED SUIT