In order to manage their companies’ inventory, business owners create procedures . The type of small business, size of operations and number of business locations often dictate the model of inventory management system a company uses. Inventory replenishment features include an authorized purchase order sent to a vendor or supplier requesting additional inventory products. Business owners generally implement a specific inventory order process for replenishing inventory. These products was receives and verifies by the company employee.
NVENTORY MANAGEMENT WHAT IT IS: Inventory management is the process of ensuring that a company always has the products it needs on hand to support daily, weekly, and monthly production. This process includes however not limited to; shop tooling, raw materials, machine maintains stock, internal shop stock, hardware stock, office supplies, etc. HOW IT FUNCTIONS: Some inventories are identified as company assets that are intended for use in the production of goods or services made for sale, are currently in the production process, or are finished products held for sale in the ordinary course of business. There are three types of inventory: raw materials, work-in-progress, and finished goods. Given the significant costs and benefits associated
An organization holds the stock in limited quantity for the future purpose to use it properly, when it is required and running all the operations in a continuous flow. To maintain this operation properly an organization has different inventory control models in inventory management. In this paper we have discussed about the inventory models which are beneficial to take decision about the stock for an organization time to time to avoid the problem arises. The deterministic model and the probabilistic model are the two main models in inventory management. In general, demand is not known that model is called probabilistic model and the demand is constant at a fixed interval that model is called as deterministic model.
Inventory management performs a significant function in maintaining specific operating requirements for a business (Stewart, 1997). Inventory involves taking stocks for a business to sustain its operation and meet consumer demands. It is considered as one of the most valuable assets because the turnover of inventory represents the primary sources of income and earnings for the company (Shue, Chen, & Shiue, 2009). Maintaining a specific level of inventory is vital because high level inventory and stock out significantly affects the profitability of the business. Possessing high level of inventory for a long period of time tends to increase operating cost due to inventory storage, dead stocks or items that are not selling, and spoilage costs of perishable items.On the other hand, stock out or failure to maintain adequate amount of product supply affects customer satisfaction which might lead to disappointments of potential customers and opportunity to lost
Introduction The Inventory Management System is an automated version of manual Inventory Management System. It can handle all the records of a inventory. The details include sales details, purchases details, customers personal details, stock details exam ,product information, tax information and many more details In case of manual system they need a lot of time, manpower etc .Here almost all work is computerized. So the accuracy is maintained. Maintaining backup is very easy.
Inventory management is one of the important functions of production management. Inventory levels must be maintained in order to balance the carrying costs and the cost of providing reasonable levels of customer service. Inventory management includes the tracking of inventory transactions, accurate information about demand and lead times, realistic cost estimates and a system for classifying the items in the inventory to ensure various levels of control. Some of the classification techniques discussed in this chapter are ABC classification, VED classification and FSN classification. Two classes of inventory models are demonstrated: EOQ model and EBQ model.
Benefits of an Inventory Management System There are many benefits to implementing an inventory system and some of these benefits are; to assure that goods will be available for customers when required, to ensure to have repeat customers, to increase the accuracy of inventory orders and to increase employee efficiency (Kontus, 2014). When the suitable inventory management system is implemented it automatically improves the business performance. In addition, as indicated by Henrietta, the overall product design and the product’s individual features create benefits for customers and the benefits give customers a reason to buy because they explain how your product or service improves their lives (Henrietta, 2014). The nine (9) key features as
Inventory optimization remains one of the key challenges in supply chain management. Typically, large amounts of working capital are tied up in today’s supply chains, restricting the opportunities for growth that are essential for a company’s success in competitive markets such as the process industry sectors. Furthermore, reported inventory figures become an increasingly important indicator for investors and other external stakeholders when assessing the efficiency and health of the whole company. Still there is an ongoing trend towards increasing inventories in process industries. Major reasons for this development are: Volatile markets Increased complexity of the product portfolio Fear of lost sales due to stock-outs Increased variability