Review of Related Literature
In this chapter, it will discuss the study about the inventory system which is found very useful and which will relate to the proposed study.
Inventory Controls are keys to dissuade employees from stealing, states that, Computers can only do much, but coupled with in calculating honesty among staff and instituting the appropriate deterrents; they can work very well in minimizing losses and pilferages. It is highly advisable to do both the manual and the computerized inventory system in retail and wholesale business. This study about the inventory controls, this has a similarity for the researcher study because it will control the employees from losses and stealing. The researcher study about the school inventory of property, the company will monitor those properties inside the schools so that they can will identify those items status on many offices. (Junaito Villegas, 2009)
This study about Inventory management has a similarity to the research proposed study because it is monitored stocks and tracks those items but in the study stated that only come up and focusing monitoring of goods and raw materials, tracks of sale and management of losses this will be the dissimilarity of the researcher study. Inventory management is an integral part of any successful business, serving to provide uninterrupted production, sales and/or customer service at a minimum cost. Inventories usually consist of goods, raw materials and finished products. An inventory management system tracks the sale, purchase and payments related to these elements of inventory. Ineffective inventory management can contribute to losses or business failure, since this crucial component is so vital to the profits and costs of the business. Inventory management can be highly complex. This guide will provide you with a thorough knowledge of inventory management, including elements of an effective inventory management system, different tracking systems and other terms and procedures you need to know (Hayden, 2014).
The similarity of the researcher study is monitored the inventory of stocks which the items that can they easily managed the prices and track those items status. An Inventory control System is a system that encompasses all aspects of managing a company’s inventories: purchasing, shipping, receiving, tracking warehousing and storage, turnover, and reordering. In different firms, the activities associated with each of these areas may not be strictly contained in separate subsystems, but these functions must be performed in sequence in order to have a well-run inventory management, including counting and monitoring of inventory items, recording and retrieval of item storage location, recording changes to inventory, and anticipating inventory needs, including inventory handling requirements. Through the use of such system can be further increased when a business integrates its inventory control systems with other systems such accounting sales to better control inventory levels (Harris, Angela D, 2007).
The similarity of this study to the researcher study is the storing item to the inventory and tracks of items. Keeping of records to directly print the reports needed for items and it will improve the work efficiency to handle big data and time consuming task by monitoring items. Inventory is the total amount of goods and materials held in stock by a factory, store and other business. An inventory system is a process whereby a company keeps track of the goods and material it has available. In its simplest sense, it can be done manually by a count at the end it has available. In this way, it is possible to keep a record of the goods coming into the business and goods being sold. Since manual inventory consumes a lot of time and is prone to errors, it would be helpful to build a system that will computerize the transactions from an acquisition of the product description to updating the inventory database. The computerize inventory system will improve employees work efficiency by computerizing routinely and time-consuming task such as the time spent in taking down products information. As a result, the time can be used in more productive activities. The accuracy of the current system will also be improved, since the computerized inventory system would eliminate the need of always encoding lengthy of products by having an inventory database (Benguet, 2011).
The system has a similarity to the researcher proposed system because the school Property Inventory has a similar to record items and keep tracking of items. The school has manual system which is to slow and inaccurate resulting the records of items like transfer of items into another place. Inventory system is a process whereby a business keeps track of the goods and material it has available. In its simplest sense, it can be done manually by account at the end of each day. In the way, it is possible to keep a record of the goods coming into the business and goods being sold. However, this is only appropriate for small businesses that do not have a lot of stock. For larger business, it is more likely that computerized system to be required. Manual inventory systems turned out to be slow and inaccurate resulting in problems like running out of stocks and slow computations of products prices being bought by the customers (Ken Vincent, 2012).
This study has a similarity to the research proposed system they monitored stocks based on the needed stocks but in research study it only monitored the items on hand. The dissimilarity of this study is managing the organize availability of customers and intended for inventory warehousing and sales because the researcher only focus by the property inventory system. The Inventory control is the activity which organizes availability of items to the customers. It coordinates the purchasing, manufacturing and distribution functions to meet the market needs. This role includes the supply of current sales items, new products, consumables; spare parts, obsolescent, and all others supplies. Inventory enables a company to support the customer service, logistics or manufacturing activities in situations where purchase or manufacturing of the items is not able to satisfy demand. Lack of satisfaction could aisle either because of the speed of purchasing or manufacturing is too protracted, or because quantities cannot be provided without stocks (R.S Saxena, 2009).
The study is also similar to the researcher proposed study because it covers the process of overseeing the flow of items into and monitored those items condition. Inventory management can be very convenient if you know how to do it. Well-functioning system is a process of overseeing the flow of items into and out of your stock. It’s a balance of having just enough products in the warehouse. Effective inventory management keeps the stock costs under control so you can run a successful business (Hiiemaa, 2015).
Computer-based system is a complex system wherein information technology plays a major role. It makes the work easier, faster and more accurate. Due to that fact, the automated scheme has become essential to small and big companies for they are expected to give the best services possible. Nevertheless, some businesses still prefer sticking with the system that is not integrated with technology. Probable causes are computer illiterate staff and lack of funds. Companies, especially the big ones are recommended to switch from manual to automated systems because this will improve the efficiency and productivity of the business which will uplift the industry’s reputation. One of the most sought after automated systems of different companies is a purchasing and inventory system which comes hand in hand. A purchasing and inventory system is very important in every organization because a good purchase and inventory management can create excellent productivity. Primarily, i6nventory work consists of input, output and restock. Input is a process of buying new products into the inventory and replacing the old products with the new ones. Meanwhile, output is a procedure of taking out the products from the inventory for sales or usage and refill is a process of increasing the number of existing products in the inventory in order to fulfill the insufficient products or escalating demands. Most of the retailing market is using traditional way in the inventory management system where a person is assigned to check and record the stock by hand using pen and paper. It is where operations with regards to all the stock will be archived (Computer-Based Inventory System. StudyMode.com, 2010).
Uses reorder level/reorder point for its inventory forecasting on his study on Inventory Management at Reid and Taylor ltd. India to determine the economic order quantity and to decide how much to order. CRPatna mentioned that reorder point is an inventory level at which an order should be placed to replenish the inventory. Determining the reorder point in certainty, the following term are useful to formulate reorder level: Lead time, average usage, and economic order quantity. Lead time is the time normally taken in replenishing inventory after order has been placed and by certainty the lead times do not fluctuate. The reorder point was computed under the assumption of certainty. It is difficult to predict usage and lead time accurately. The demand for material may fluctuate from day to day or from week to week. The actual delivery time may be different from the normal lead time. If the actual usage increases or delivery of inventory is delayed, the firm can face a problem of out of stock which can prove to be costly for the firm. Therefore, in order to guard against the out of stock, the firm may maintain a safety stock for expected increased usage and/or delay in inventory time. (C.R Patna, 2010)
The periodic inventory does not work well for some types of business because some businesses has a daily transaction and if they use these kind of method it might difficult for them to identify or minimize the cost of inventory such as delivery, and purchase costs. However, for a small business such as museum inventory it allows the organization to focus on determining the problems with the inventory and make the necessary changes to maintain an accurate inventory (Tatum, 2014).
As the researched conducted by the U.S Small Business Administration, “Inventory refers to stock of anything necessary to do business” (U.S Small Business Administration, 2010) the U.S Small Business Administration publication describes what constitute successful inventory management balancing cost versus benefits of inventory, including maintaining a wide assortment without spreading the rapidly moving items too thin, increasing inventory turnover without sacrificing service, keeping stock low without sacrificing performance, obtaining lower price by making volume purchases, maintaining an adequate inventory without an excess of absolute items.
Companies are increasing employing Inventory System. Computers start with inventory counts in memory. Withdrawals are recorded by the computer as they are made, and the inventory balance is constantly revised. When this new order is received, the recorded balance is increased. Retail stores have carried this system quiet far, each item has magnetic codes, and as on item is checked out, it passes through an electronics reader, which then adjust the computers inventory balance, at the same time the price is fed to cash register tape. When the balance drops to the recorder point, an point is place. (Mr. Eugene F. Brigman 2006)