Ha-Ji

Powerful Essays
Chapter 1

INTRODUCTION

Background of the Study

Sales and Inventory System is a process wherein a business keeps track of the goods and materials that is available and record its sales every transaction. The term inventory means the total amount of goods or materials contained in a store or factory at any given time while sales means an act of selling of a product or service in return for money or other compensation. Sales and inventory system could monitor the movements of the stocks as well as the sales transactions (“Small Business Management”, n.d.).

A successful relationship between sales and inventory operations involves either a predictable rhythm of inventory turnover as a result of consistent sales, or dependable communication between the two. In order for the system to function smoothly, the sales must have a clear idea of how long it takes the inventory to acquire more products, through production or ordering, and must plan its orders accordingly (Jane, 2011).

Companies take an inventory of the supplies on a regular basis in order to avoid running out of popular items. Others take an inventory to ensure the number of items ordered matches the actual number of items counted physically. Companies take an inventory every quarter in order to generate numbers for financial reports and tax records. Ideally, most companies want to have just enough inventories to meet current orders.

Due to the fact that Sales and Inventory System is already available, still many companies operate manual processes. AMCO Water Metering Systems, the widest product portfolios in the water metering industry is one of the companies that still using manual sales and inventory system. The manual process of the company slows down its warehouse and distribution operations. Workers only used paper forms for them to record product moves and take annual physical inventories and later enter the data on a stationary computer (Albright, 2010).

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