Inventory management is needed in order to keep track of a company's goods and services.If you do not know what is available, then you cannot use it to your advantage.There are two kinds of inventory systems.They are the perpetual and periodic inventory systems.They are updated in two totally different ways.This article will focus on the perpetual system.
With the perpetual system, the inventory is always updated.The system is update for when orders are shipped, placed or received.This is because computers can operate in real time.When product is received, it is put into the system via bar coding technology.Everyone seems to like this system because the info is always updated.You know that you info will be the most recent that is available.
However, if there are any mistakes, it is usually due to human error.The information is only as accurate if it is entered into the system.Info cannot be analyzed if it does not reach the system.This is why it is important that all orders are handled at the time that they are placed, received or shipped.
Obviously, all systems will have good and bad features.Because the reporting is done in real time, this is a huge benefit.For instance, sales personnel must know how much inventory is in stock before they can sell it to potential customer.This is especially true if the customer is expecting same day delivery.This information can be pulled from the salesperson's laptop or phone.The info is easy to get.It is a smart way to check inventory before placing a same day order for a customer and finding out that the product is not in stock.
Previously, the salesman would have had to call someone back at the office to get this information.Many times this would have meant sending someone out to the warehouse in order to do an actual physical count of the inventory.For some companies, this might take hours.This is why the perpetual system is popular.It saves everyone time and headaches.
There are only a few bad things about this system.The loudest complaint is that it is a huge upfront investment.The software for this type of system is not cheap.But, once you get past this, it is a great system.Secondly, as stated throughout this article, the system has to be constantly updated.You have to key in a lot of information.
There are both disadvantages and advantages, but it is a great inventory management system.
With the perpetual system, the inventory is always updated.The system is update for when orders are shipped, placed or received.This is because computers can operate in real time.When product is received, it is put into the system via bar coding technology.Everyone seems to like this system because the info is always updated.You know that you info will be the most recent that is available.
However, if there are any mistakes, it is usually due to human error.The information is only as accurate if it is entered into the system.Info cannot be analyzed if it does not reach the system.This is why it is important that all orders are handled at the time that they are placed, received or shipped.
Obviously, all systems will have good and bad features.Because the reporting is done in real time, this is a huge benefit.For instance, sales personnel must know how much inventory is in stock before they can sell it to potential customer.This is especially true if the customer is expecting same day delivery.This information can be pulled from the salesperson's laptop or phone.The info is easy to get.It is a smart way to check inventory before placing a same day order for a customer and finding out that the product is not in stock.
Previously, the salesman would have had to call someone back at the office to get this information.Many times this would have meant sending someone out to the warehouse in order to do an actual physical count of the inventory.For some companies, this might take hours.This is why the perpetual system is popular.It saves everyone time and headaches.
There are only a few bad things about this system.The loudest complaint is that it is a huge upfront investment.The software for this type of system is not cheap.But, once you get past this, it is a great system.Secondly, as stated throughout this article, the system has to be constantly updated.You have to key in a lot of information.
There are both disadvantages and advantages, but it is a great inventory management system.
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