What is inventory management?
Inventory management is the supervision of non-capitalized assets (inventory) and stock items. Inventory management supervises the flow of goods from manufacturers to warehouses and from these facilities to point of sale.
Let’s understand the operation part of inventory management step by step:
A new product enters a warehouse.
Its allocation is done through bar coding or SKU also known as Item Allotment.
A transfer (inbound or outbound) might be made from 1 warehouse to another for various reasons.
The product leaves warehouse at the time of sale.
It again comes back due to customer return.
Inventory management also calculate any missing or damage of product as it will count as inventory loss.
Drop ship and quality control is managed under inventory management as well.
It’s not by God’s grace that a product will find its way to a warehouse. It has to be procured or purchased.
Let us briefly understand procurement.
A procurement is a request for a specific quantity of products to a specific location. It includes following steps:
Identification of Requirement
Authorization of Purchase Request
Approval of Purchase Request
Identification of Suppliers
Inquiries Receipt of the Quotation
Selection of the Vendor
Purchase Order Acknowledgement
Advance Shipment Notice
3 Way Match
Payment to Supplier
How to videos: