Inventory control helps a business maintain enough stock to meet customer needs without tying up too much money in inventory. This lesson explains what inventory control covers, how it differs from inventory management, and how systems and technology support it.
Inventory control, also called stock control, is the process of managing stock held in a warehouse, store, or another storage location. It includes checking and recording stock, as well as making decisions that help keep supply at an appropriate level.
All flashcards
What is inventory control?
Managing stock held at a storage location so supply can meet customer needs without unnecessary inventory investment.
How does inventory management differ from inventory control?
Inventory management covers the wider supply-chain process, from sourcing to order fulfilment; inventory control focuses on stock held at a storage location.
What can inventory management software help a business do?
Track and forecast stock, optimize stock levels, calculate safety stock, and support purchasing and replenishment decisions.
How do barcodes, RFID tags, and QR codes support inventory control?
They help identify inventory items and record stock movements; QR codes can be scanned with smartphones.
Why does inventory control aim to avoid both stock-outs and excess stock?
Stock-outs can prevent customer service, while excess stock can tie up investment and create costs.
Quiz questions
What is the timing difference between periodic and perpetual inventory calculations?Answer: Periodic calculations are made for a set period; perpetual calculations are updated with each purchase.
What is the aim of just-in-time (JIT) replenishment?Answer: To replenish inventory when it is needed and avoid excess stock.
In vendor-managed inventory (VMI), who monitors, plans, and controls inventory for the customer?Answer: The vendor.
In customer-managed inventory (CMI), who controls ordering from vendors or suppliers?Answer: The customer.
Why should perpetual inventory records be checked against physical counts from time to time?Answer: Scrap, human error, theft, and other factors can make recorded quantities differ from stock on hand.
Based on the Wikipedia article Inventory control, licensed CC BY-SA 4.0. Adapted into a summary, flashcards and quizzes.