Inventory Management

Inventory management refers to the process of managing stocks of finished products, semifinished products and raw materials from a company. Inventory management, if done properly, can bring costs and increase revenue of a company.

How much should you invest in inventory management? The answer to this question depends on the volume and value of stocks as a percentage of total assets of a company. The importance of inventory management varies according to the industries. For example, an automotive retailer stocks have very high, sometimes up to 50 percent of total assets, while in the hotel industry can be as low as 2 to 5 percent.

The process of inventory management is a continuous and there are various types of solutions available. It is advisable to employ specialized staff for inventory management.

The inventory management process begins as soon as we started to produce and ordered raw materials, intermediate or anything else from a supplier. If you are a retailer, this process begins as soon as you have placed your first order with the wholesaler.

Once orders are placed, there is usually a short period of time for a company to put a plan to inventory management in place before the supplies are delivered. Inventory management allows a company to decide in advance where these supplies are to be preserved. If a company is the supply of products of small dimensions, can not be a big problem to store them, but in the case of products of large dimensions, one must be careful to ensure that the storage space is used optimally.

From invoices to purchase orders, there is a lot of bureaucracy and documentation involved in inventory management. Several software programs are available on the market, which help in inventory management .......