Inventory is basically the total amount of goods and materials held in stock by a factory, store and other business. This can be the food held in stock by a restaurant or the produce held for sale by a store. For a business to be run efficiently it is important that they keep a record of their inventory as this keeps them informed of when they are running short of something and need to restock to ensure they can serve their customers. An inventory system is used for this purpose.
An inventory system is basically a process whereby a business keeps track of the goods and material it has available. In its simplest sense it can be done manually by a count at the end of each day. In this way it is possible to keep a record of the goods coming in to the business and goods being sold. However this is only really appropriate for small businesses that do not have a lot of stock. For larger business it is more likely that a computerized system will be required.
There are many types of business that can benefit from using an inventory system. Retail outlets which stock and sell goods, warehouses that have goods and materials passing in and out on a daily basis and manufacturers that produce and sell products are just a few of this. It can be essential for companies that have a high turnover of stock and need a simple way of keeping track of this to ensure their business runs smoothly and efficiently.
These days a computerized inventory system is the most likely to be used by medium and large businesses although some small businesses may also use this. These typically use barcodes or radio frequency identification tags to keep a record of inventory objects. This can be used to keep a track of customer orders, monitor the stock a business has available for fulfilling orders and also provide details of when inventory needs to be restocked.
Buying inventory costs money. Therefore more efficient control of the amount of inventory required to be held in stock to...
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