Stock Management
Learning Objectives
I. Definition of Stock Management
II. Remaining Stock (Units)
III. Stock list
IV. Safety Stock
V. Inventory/Stock Management Techniques to Avoid Theft / Loss
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I. Definition of Stock Management
The monitoring and control of goods and stock so that new stock can be ordered as required and the right numbers and quantities made available at all times.
Management should be easy to control,order and find stocks.
II. Remaining Stock (Units)
Remaining stocks before adjustment = beginning stocks + stocks in – stocks out + stocks returned in – stocks returned out to suppliers
Remaining stocks after adjustment= remaining stocks before adjustment +/- adjustments
III. Stock list
It is list or inventory of the goods or raw materials kept on the premises of a shop or business.
IV. Safety Stock
Safety stock is a term used by logisticians to describe a level of extra stock that is maintained to mitigate risk of stockouts due to uncertainties in supply and demand.
Safety stock is an additional quantity of an item held in the inventory in order to reduce the risk that the item will be out of stock, safety stock act as a buffer stock in case the sales are greater than planned and/or the supplier is unable to deliver the additional units at the expected time.
V. Inventory/Stock Management Techniques to Avoid Theft / Loss
Here are five techniques to help you reduce loss of inventory by theft:
1. Responsibility for losses
Before you can reduce theft, you need to know who is responsible for losses.
2. Educate Your Employees
You should educate them on how prevent theft. You educate your employees about loss prevention and in-store inventory control.
3. Put up Your warehouse/store Signs and word
For our example, you cannot take stock out without approval.
4. Stocks in or out are documented
Stocks in or out should have enough documents and authorized approval.
Authorized peoples may include people who prepare, verify or approve stocks in or out.
5. You may want to install security cameras. Even if you don’t have a physical store – you might want to use tracking methods such as cameras and time-clocks so that you know which employees are around the inventory at all times.
6. Make sure your employees know that you are carefully keeping track of your inventory with highly efficient inventory management techniques. Employee theft is far less likely if inventory systems are well-run and organized.
7. Only allow trained and trusted employees to edit data in your inventory management software. Make sure employees do not share user ID or passwords. This will give you an ability to audit changes made to inventory numbers if you ever identify a problem.
8. Store your inventory in a secure place. The doors are always locked and alarms are always set. Only allow certain employees (either supervisors or managers) to have access to the most expensive inventory items.
9. Cyclical counting
Regular inventory counts make companies aware of missing inventory as soon as it is lost or stolen. It can surprise stock counts.
10. Hire a Security Guard
If you did not hire employees for security guard, you are looking to hire a security guard.