Field inventory management commonly known as inventory management is the function of understanding the
Stock mix is the combination of Product (business), products a company sells or manufactures. The stock mix is determined by the demand for certain products and the Profit (accounting), profitability of those products.
of a company and the different
Economics () is a social science
Social science is the branch
A branch ( or , ) or tree branch (sometimes referred to in botany
Botany, also called , plant biology or phytology, is the science of plant ...
s on that stock. The demands are influenced by both
Internal may refer to:
*Internality as a concept in behavioural economics
*Neijia, internal styles of Chinese martial arts
*Neigong or "internal skills", a type of exercise in meditation associated with Daoism
*''Internal (album)'' by Safia (band), ...
factors and are balanced by the creation of
A purchase order (PO) is a commercial
Commercial may refer to:
* a dose of advertising conveyed through media (such as - for example - radio or television)
** Radio advertisement
** Television advertisement
* (adjective for:) commerce, a system ...
requests to keep supplies at a reasonable or prescribed level. Inventory management is important for every other business enterprise.
Retail supply chain
Inventory management in the retail supply chain follows the following sequence:
# Request for new stock from stores to head office,
# Head office issues purchase orders to the vendor,
# Vendor ships the goods,
# Warehouse receives the goods,
# Warehouse stores and distributes to the stores,
# Shops and/or consumers (e.g. wholesale shops) receive the goods,
# Goods are sold to customers at the shops.
SaaS inventory management software is a tool to help efficiently manage stock. While the capabilities of applications vary, most inventory management applications give organizations a structured method of accounting for all incoming and outgoing inventory within their facilities. Organizations may save costs associated with manual inventory counts, administrative errors and reductions in inventory stock-outs.
Often tracking stock just through sales and returns is not enough for retailers and does not meet the demands of customers multichannel expectations. Customers expect retailers to have real-time knowledge of stock availability.
This can be a challenge for retailers who may have on-line as well as bricks and mortar outlets.
A good inventory management system will be able to list all stock options with a size colour matrix as well as give live reports on best or worst sellers, supply chain and sales staff.
Many large organizations use sophisticated ERP systems such as
Oracle EBSOracle Applications comprise the applications software
Application software (app for short) is Computer program, computing software designed to carry out a specific task other than one relating to the operation of the computer itself, typically to b ...
for inventory management. Stock modules in these ERP systems provide many of the options needed to manage inventory.
The stock size needs to correspond to the amount of products which are sold. If the stock is too large (especially with
Decomposition is the process by which dead organic substance
Chemistry is the scientific
Science () is a systematic enterprise that builds and organizes knowledge
Knowledge is a familiarity or awareness, of s ...
goods as fruit, vegetables, ...) there is a risk of financial losses as some of the inventory
. To reduce this risk (and keep financial losses as small as possible), there is hence benefit in precisely recording the weekly purchases of the shop's customers. This can be done through purchases tracking
per individual shopper.12 Sneaky Ways That Big Retailers Track Your Every Move
Supply chain management
Commerce is the exchange of goods and services
Goods are items that are usually (but not always) tangible, such as pens, salt, apples, and hats. Services are activities provided by other people, who include doctors, lawn ...
* Document automation Document automation (also known as document assembly or document management) is the design of systems and workflows that assist in the creation of electronic documents. These include logic-based systems that use segments of pre-existing text and/or ...
* Warehouse management system
A warehouse management system (WMS) is a software application designed to support and optimize warehouse functionality and distribution center management. These systems facilitate management in using simplified automatic technologies useful in da ...
* Storage management system #REDIRECT Hierarchical storage management #REDIRECT Hierarchical storage management
Hierarchical storage management (HSM) is a data storage technique that automatically moves data between high-cost and low-cost storage media. HSM systems exist bec ...
* Automated identification and data capture Automatic identification and data capture (AIDC) refers to the methods of automatically identifying objects, collecting Data (computing), data about them, and entering them directly into computer systems, without human involvement. Technologies typi ...
* Economic order quantity Economic Order Quantity (EOQ), also known as Economic Purchase Quantity (EPQ), is the order quantity that minimizes the total holding cost
In marketing, carrying cost, carrying cost of inventory or holding cost refers to the total cost of holding i ...
* Economic lot scheduling problem
The economic lot scheduling problem (ELSP) is a problem in operations management and inventory theory that has been studied by many researchers for more than 50 years. The term was first used in 1958 by professor Jack D. Rogers of Berkeley, who ext ...
* Newsvendor model The newsvendor (or newsboy or single-periodWilliam J. Stevenson, Operations Management. 10th edition, 2009; page 581 or salvageable) model is a mathematical model in operations management and applied economics used to determine Inventory optimizatio ...
* Vendor-managed inventory
Vendor-managed inventory (VMI) is an inventory management
Field inventory management commonly known as inventory management is the function of understanding the stock mixStock mix is the combination of Product (business), products a company sells ...
* Scan-based trading
Scan-based trading (SBT) is the process where suppliers maintain ownership of inventory within retailers' warehouses or stores until items are scanned at the point of sale. Suppliers, such as manufacturers or farmers, own the product until it is pu ...