Stock Company Management is a process for managing stocks which are items that must be monitored and stored. They can comprise work in progress (partly finished materials and goods) or finished goods, along with consumables, such as photocopier toner and stationery. Controlling stock is crucial for cash flow and profitability.
Different methods of managing stock and the one that is the best for your company is dependent on the type of products you sell and the industry. Some companies, like utilize computer software to keep track of inventory and keep track of cost. These programs are often integrated with point of sale equipment and freight tracking systems. They may be more expensive than manual stock records, however, they can eliminate mistakes and improve accuracy.
Other companies use a technique known as Just In Time or JIT, which reduces inventory and storage costs by reducing stock to a minimum. This method requires accurate forecasting, an efficient supply network, and number of members for a quorum can reduce customer service issues like out-of-stock. Some companies use a formula called Economic Order Quantity (EoQ) to determine the amount of safety stocks to keep. This formula balances the need to order and store extra with the cost to order and store it.
It is important to establish procedures for maintaining accurate records of inventory, and ensuring they are checked regularly. This can be done by periodic reviews or a full stocktake. To prevent fraud and corruption, it’s best to separate the staff who manage stock control from those who do finance and accounting.
