Inventory Management Essay

stock is the quantity or total amount of goods and materials in a store or factory for some immediate or some future use. The reasons for retentivity more than adequate stocks of livestock would be1. to keep business operations running and to meet flow orders2. to meet unforeseen demand and to effectively meet customer orders3. to take care of the lead age , ie , the time gap between ordering the stores and receiving them and place orders accordingly4. to use as a hedge against price increases and inflation and obligate losses5. to even out erratic demand requirements.Inventory control or inventory management is an attempt to maintain an adequate supply of goods while minimizing inventory costs resulting from obtaining and holding inventory with the purpose of providing information to efficiently manage the flow of materials, effectively give people and equipment, coordinate internal activities and communicate with the customers. .Some of the terminologies related to inventory management areEOQ-Economic grade Quantity or how much to orderSAFETY STOCKS- how much inventory to hold on come aboutREORDER LEVEL the minimum levels of stocks at which new order for stocks is to be placed.Visual control enables the bus to examine the inventory visually and determine if more inventory is required.Tickler control -enables the manager to physically count a small fate of the inventory each day so as to loom the entire range of inventory regularly over several days.Click sheet control is a method whereby the manager records the item as it is utilise on a sheet of paper. This information is used while determining the reorder levels.Stub control (used by retailers) enables the manager to retain a portion of the price ticket when the item is sold. The manager can then use the stub to record the item.point-of-sale terminals relay information on each item used or sold. The manager receives information printouts at regular intervals for review and action. Off-line po int-of-sale terminals relay information directly to the suppliers data processor who uses the information to ship additional items automatically to the buyer/inventory manager.The final method for inventory control is done by an outside agency. A manufacturers representative visits the large retailer on a scheduled basis, takes the stock count and writes the reorder. Unwanted merchandise is removed from stock and returned to the manufacturer through a predetermined, authorized procedure.