Stock control, also known as inventory management, is a series of procedures intended to manage the flow of goods through retail environments. Digital inventory systems now make up the bulk of stock control devices, but some small businesses still use pen and paper ledgers.
You can click here to read more about the Top 5 Benefits To Maintaining Good Stock Control
Having too much of an item, particularly one with a limited shelf life can harm profits almost as much as not having an item in stock when a customer walks through the door intending to buy. Stock control systems and procedures are designed to optimize the amount of inventory on hand to maximize sales and customer satisfaction. The reason these systems matter is because customers who arrive at the store hoping to purchase an item that is out of stock ultimately leave frustrated, and might never return. As any sales representative might tell you, repeat business is the key to success in a brick-and-mortar operation, so ensuring that the business can meet the customer’s expectations is of the utmost importance.
The key purpose of stock control is to minimise excess stock and controlling the cost of stock handling, while ensuring that firms have sufficient stocks to meet consumers demand. The proposition sounds simple but it is much more complicated since there is always fluctuation in demand of goods and some of which may not be predictable.
The main reason for holding stocks of work-in-progress is to allow greater flexibility in the utilisation of machinery, while holding finished goods in stock allows for variations in consumer demand patterns. The demand for certain products, for example, is influenced by the weather. A sudden cold or hot spell can affect demand patterns significantly and producers may suddenly find themselves running out of stocks completely or alternatively, having excess stocks and facing the problems associated with storage and storage costs.
Holding of stock has a lot more to do but firms must follow a procedure in order to avoid unnecessary mistakes;
Let’s find out which are the direct cost related to holding cost;
One of the primary significant reasons for business disappointment is poor income. Stock is a liquidity issue, since stock speaks to tied-up capital, which can’t be discharged until crude materials are transformed into completed products and afterward sold. Having cash tied up in stock isn’t only the expense of tying up liquidity, yet additionally the open door cost of cash that could be sent somewhere else, for example, putting resources into greater limit.
While there can be significant costs involved in holding high stock levels, there are also significant risks and associated costs, of holding low levels of stock, which may result in a stock-out situation. This situation could have some of the following consequences:
Stock Control System also known as Inventory Control System, incorporates all the functions that are related to management and maintenance of the inventory. A good stock control system takes care of everything, from purchasing, product tracking, and product turnover, to storage inputs, shipping and receiving, and re-ordering the products. There are four different types of stock control system:
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How is it different from it’s Manual counterpart?
An automated stock control system is much more reliable as compared to a person who uses a pen and paper to maintain stock numbers. An automated control system helps in maintaining accuracy and increases efficiency and productivity thereby decreasing the use of financial resources. Adopting this system will not only make the quantitative product analysis easier but also provide you with future projections related to the inventory. Other benefits of a stock control system are:
All of these remarkable benefits make a stock control system more powerful when compared to a manual system. Also read, (How does stock control influence your business growth?)
Why Herbst Stock Control System?
Herbst Software is known to offer a powerful fully integrated stock management system, built to deal with a wide range and high volume of stock operations. This solution gives you the ability to manage your product life cycle and optimise inventory operations across the organisation, then linking this information in real-time directly with all of the other software features and business processes.
The purpose of this solution is to completely automate your stock control procedures with 100% accuracy. With the sales and purchases ledgers being fully integrated, stock levels are easily maintained and tracked as this data connects directly with the stock levels. Additionally, this solution gives you real time insight into the current stock levels and allows for actionable information you can use to keep your business running efficiently at all times. Our touch screen kiosk software is also available to use in warehouses to facilitate real-time management of stock.
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