Inventory System: Why do it?
An inventory system is important in running and managing any business. An inventory system can sometimes be intricate and simple. Most of businesses do determine what they will record and what it includes. Decide and be specific what you include in the inventory. For an instance, if you’re doing an inventory of office equipment such as computers, copiers, fax machines, and communication devices, it is advisable to be methodical so you won’t be in trouble in the long run, and it helps you facilitate things well. It is also advised to determine all aspects of a particular item in the inventory list. Be specific in your record, consider the technical aspects, size, date purchased, serial number, unit number, brand, and others. Gather all the date precisely and make sure that you maintain this inventory management system. Don’t forget to enter the information into the company’s inventory system. Every company has its own data base software or something like spreadsheet. Your inventory management system must be used safely and securely.
Why is inventory system important?
Keeping and maintaining an inventory is very significant procedure in the business, because inventories are frequently the expense incurred from business operations. The purpose of an inventory system is to track and sustain the inventory itself; to increase effectiveness in the operations as well.
• Inventory orders – this helps many businesses in their accurate recording of consumer sales. There’s an electronic type of ordering which is called Electronic Data Interchange (EDI). This permits companies to retain the proper amount of stock by controlling the costs. It also ensures that orders are placed instantaneously.
• Stock maintenance – this allows businesses to properly order and maintain various types of items/goods as with its computerized features.
• Price levels – employing inventory system would help the business find the lowest price on inventory items and ensure the best deals are achieved upon purchasing of items. Moreover, it tracks costs from purchased items and organize a report indicating which suppliers have the lowest cost on goods.
• Count methods – it is a cardinal for every company that all inventories must be counted and arranged. Through the help of computerized systems, the inventory procedure will be efficient. Inventories can be adjusted after conducting a physical count.
• Trend analysis – one of the functions in inventory management system is the trending analyses that are produced for management check. The said trends are used to verify which months have high inventory levels.