The inventory system applied in the past is done manually and the process takes a lot of time. A disadvantage of manual inventory systems is that they can be highly labor-intensive to operate. They require continuous monitoring to ensure that each transaction is accounted for and that products are maintained at the proper stocking levels. It is also more difficult to share inventory information throughout the business, because the lack of computerization makes accessing inventory records a more cumbersome process. The time spent monitoring inventory levels could be used on more productive activities for the business. A manual inventory system relies heavily on the actions of people, which increases the possibility of human error. People might forget to record a transaction or simply miscount the number of goods. This results in needless additional orders that increase the business inventory carrying costs and use up precious storage space. Inaccurate physical counts could also result in not ordering enough of a product, meaning the business could run out of a crucial item at the wrong time. Keeping track of daily purchases is another difficult controlling measure with manual inventory systems. While technological inventory systems scan the item and subtracts the item from the inventory, a manual inventory system requires the employees to write down the items sold during a single work day. This can be a difficult task, as one employee may lose the list of items sold or another may forget to write down a sale.
A computerized inventory management system makes everything from inputting information to taking inventory easier. Doing a hand count of inventory can take days, but with a computerized inventory management system, the same process can be done in a matter of hours.
A computerized system alone does not ensure accuracy, and the inventory data is only as good as the data entry that created it. Outside factors like