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Inventory Management

Inventory Management. A vital key to a successful business. By Aaron Labin. How the world would be different if we were only 99.9% accurate. 2,000,000 documents will be lost by the IRS this year. Two planes per day landing at Chicago O'Hare airport will be unsafe .

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Inventory Management

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  1. Inventory Management A vital key to a successful business. By Aaron Labin

  2. How the world would be different if we were only 99.9% accurate • 2,000,000 documents will be lost by the IRS this year. • Two planes per day landing at Chicago O'Hare airport will be unsafe. • 315 entries in Webster's Dictionary will be misspelled. • 12 newborns will be given to the wrong parents daily. • 291 pacemaker operations will be performed incorrectly. • 20,000 incorrect drug prescriptions will be written this year. • 103,260 income tax returns will be processed incorrectly during the year

  3. Definition of Inventory • Consists of a list of goods and materials held available in stock for purchase or manufacturing purposes.

  4. Tips given by the Small Business Administration • Purchasing Plan • Proper Inventory Control • Technological Assistance www.sba.gov

  5. Purchasing Plan • Can you have the right stock at the right time? • Yes, if you coordinate delivery times, quantity discounts, and order payment terms.

  6. Purchasing Plan Key Elements • Be able to account for depletion of current inventory. • When should in stock quantity be maximized? • Identify sales trends, giving you the ability to phase out “dead” inventory. • When to phase in new inventory?

  7. Proper Inventory Control: The Four Methods • Visual Control • Ticker Control • Click Sheet • Stub Control

  8. Visual Control • The most traditional style of inventory control. • If you sell x number of items per day, order more when in stock levels fall below x.

  9. Ticker Control • Simply put, count stock on a regular basis by dividing into segments and rotating daily which segment gets counted.

  10. Click Sheet • Good old pen and paper, write down what you need and re-order it. • As low tech as it goes!

  11. Stub Control • Retain a portion of the receipt, identifying the stock item and price, facilitating re-order at a later date.

  12. Technology and Inventory Control • Point-Of-Sale Systems • Offline Point-Of-Sale Systems

  13. Point-Of-Sale System • Most common seen in retailers today. • Software based. • Allow for immediate adjustments of stock. • Provide most relevant information associated with stock.

  14. Point-Of-Sale System • Can incorporate “inventory reports” which encompass and replace all aspects of the 4 key elements of inventory control. • Much more accurate, they eliminate much of the human error that goes into physically counting an inventory.

  15. Offline Point-Of-Sale • Point-Of-Sale is directly linked with suppliers. • Automatically relay information on sales trends and submits orders without human interaction.

  16. Inventory Management • Effective inventory management is a necessity. A majority of businesses assets are tied up in its inventory and it is crucial to protect this asset. Effective management of this asset can either make or break a business.

  17. Questions???

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