Primarily, the term INVENTORY means manufactured end products which are ready to be sold in the market place . Today's so called global market has shrunk into a small market where anyone can reach any market whenever they want to choose from the best and the cheapest with the help of internet. Moreover , Globalization has made it possible for foreign products to get into our developing market places. In this ever changing and developing business trend , the businesses or enterprises need to be updated frequently to keep a pace with the market and its demand and supply. Otherwise, the companies which fail to do so become obsolete in the long run.
To be updated with the latest market trends, the industries need to be fast and efficient , which was impossible with manual labour because human resources cannot be that fast and efficient as like machines. Moreover, storing a huge data in their brain was not possible . Thus, came into being the concept of such a software which does all these jobs with perfection in a much lesser time and effort.
The specific features of INVENTORY MANAGEMENT SOFTWARE which makes it impossible for industries to work efficiently without it are as follows :
ORDER MANAGEMENT :Once a company has ordered for a product delivery in huge amount, the software of the manufacturing industry automatically creates bills of material required to finish that order. It creates work order also.
ASSET / INVENTORY TRACKING : After the goods are produced, they are given specific barcodes, which helps in tracking the location of the particular product.
PRODUCT IDENTIFICATION : Barcodes were invented with the purpose of tracking products on their dispatching from the warehouse. Barcode readers are the machines meant for this reading. Every product of the same type has a barcode of its own an unique number.
SERVICE MANAGEMENT : There are some companies which provide services in place of goods and product. For such kind of enterprises, the raw materials required to provide the said or mentioned service are the inventory. Incase of these industries inventory management software manages the supply and flow of those materials. For example, JET AIRWAYS is a service industry wherein we can travel from one place to another long distance place in a very short span of time. Here the inventory are the aeroplanes, the fuel, the pilots, the cabin crew etc.
Besides the various features of this software, it works in the development of any industry as a whole. All things have both negative sides and positive sides. INVENTORY SOFTWARE is no exception. The disadvantage of it is that it is very expensive.
Channel of Distribution:
Allows Procurement time to prepare purchase orders,place orders, ERP packages, and control timing and modes of delivery. Protects againest uncertainties in lead times.
Provides time to plan and produce items while
Procurement is interacting with Suppliers. Prevents
downtime and allows for a continuous flow
Some of the more important reasons for obtaining and holding vERP Inventory are:
Predictability: In order to engage in capacity planning and production scheduling, you need to control how much raw material, ERP packages, parts, and subassemblies you process at a given time. Inventory buffers what you need from what you process.
Fluctuations in demand: A supply of inventory on hand is protection: You don't always know how much you are likely to need at any given time, but you still need to satisfy customer or production demand on time. If you can see how customers are acting in the supply chain, surprises in fluctuations in demand are held to a minimum.
Unreliability of supply: Inventory protects you from unreliable suppliers or when an item is scarce and it is difficult to ensure a steady supply. Whenever possible unreliable suppliers should be rehabilitated through discussions or they should be replaced. Rehabilitation can be accomplished through master purchase orders with timed product releases, price or term penalties for nonperformance, better verbal and electronic communications between the parties, etc. This will result in a lowering of your on-hand inventory needs.
Price protection: Buying quantities of inventory at appropriate times helps avoid the impact of cost inflation. Note that contracting to assure a price does not require actually taking delivery at the time of purchase. Many suppliers prefer to deliver periodically rather than to ship an entire year's supply of a particular stock keeping unit ( SKU) at one time.
Quantity discounts: Often bulk discounts are available if you buy in large rather than in small quantities.
Lower ordering costs: If you buy a larger quantity of an item less frequently, the ordering costs are less than buying smaller quantities over and over again. In order to
hold down ordering costs and to lock in favorable pricing, many organizations issue blanket purchase orders coupled with periodic release and receiving dates of the SKUs called for.
provides Merketing with product to sell while
Production is producing items for future sale.
Provides Distribution with the product Marketing
has sold. Immediate customer satisfaction.
Types of Stock Entry In vERP Inventory Module:
Inventory basically falls into the overall categories of raw materials, ERP packages, finished goods, and work-in-process. Remember:
Raw materials : Used to produce partial products or completed goods.
Finished product : This is product ready for current customer sales. It can also be used to buffer manufacturing from predictable or unpredictable market demand. In other words, a
manufacturing company can make up a supply of toys during the year for predictably higher sales during the holiday season.
Work-in-process (WIP): Items are considered to be WIP during the time raw material is being converted into partial product, subassemblies, and finished product. WIP should be
kept to a minimum. WIP occurs from such things as work delays, long movement times between operations, and queuing bottlenecks. Other categories of inventory should be considered from a functional standpoint
Consumables: Light bulbs, hand towels, computer and photocopying paper, brochures, tape, envelopes, cleaning materials, lubricants, fertilizer, paint, packing materials, and so on are used in many operations. These are often treated like raw materials.
Service, repair, replacement, and spare items (S&R Items): These are after-market items used to “keep things going.” As long as a machine or device of some type is being used (in the market) and will need service and repair in the future, it will never be obsolete. S&R Items should not be treated like finished goods for purposes of forecasting the quantity level of your normal stock.
Offers the Intermediary items to deliver to the Customer/End User.
Satisfies the Consumer/End User with product while Consumer/End User it is waiting for deliveries from the Intermediary.
INVENTORY MANAGEMENT SOFTWARE was specially designed to meet the difficult purposes of these types. The various difficult tasks performed by this software are as follows :
Maintenance of balance between surplus and deficit of goods in any warehouse.
Invetory tracking while it is being transported from one location to another i.e. either from warehouse to distributors ERP packages or from distributors to wholesellers or from wholesellers to retailers or directly from manufacturers to customers tracking the barcode of the product with the help of a barcode reader.
Receiving products into any locations like warehouse , godowns , market places .
Packaging and shipment of inventory.
Tracking the sales of a particular product.
Slashing down the production of a product or an inventory on it’s decreasing market demands.
For manufacturing industries , this software creates job orders , bills of materials , and helps the workers to assemble required tools and machineries for completing a particular task.