Inventory control system
Encyclopedia
An inventory control system is a process for managing and locating objects or materials. In common usage, the term may also refer to just the software components
...
Modern inventory control systems often rely upon barcode
s and radio-frequency identification (RFID) tags to provide automatic identification of inventory objects. In an academic study performed at Wal-Mart
, RFID reduced Out of Stocks by 30 percent for products selling between 0.1 and 15 units a day. Inventory objects could include any kind of physical asset: merchandise, consumables, fixed assets, circulating tools, library books, or capital equipment. To record an inventory transaction, the system uses a barcode scanner or RFID reader to automatically identify the inventory object, and then collects additional information from the operators via fixed terminal
s (workstation
s), or mobile computers.
An inventory system also manages in and outwards material of hardware.
Real-time inventory control systems may use wireless, mobile terminals to record inventory transactions at the moment they occur. A wireless LAN
transmits the transaction information to a central database
.
Physical inventory
counting and cycle count
ing are features of many inventory control systems which can enhance the organization.
Inventory management software
Inventory management software is a computer-based system for tracking product levels, orders, sales and deliveries. It can also be used in the manufacturing industry to create a work order, bill of materials and other production-related documents. Companies use inventory management software to...
...
Modern inventory control systems often rely upon barcode
Barcode
A barcode is an optical machine-readable representation of data, which shows data about the object to which it attaches. Originally barcodes represented data by varying the widths and spacings of parallel lines, and may be referred to as linear or 1 dimensional . Later they evolved into rectangles,...
s and radio-frequency identification (RFID) tags to provide automatic identification of inventory objects. In an academic study performed at Wal-Mart
Wal-Mart
Wal-Mart Stores, Inc. , branded as Walmart since 2008 and Wal-Mart before then, is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000...
, RFID reduced Out of Stocks by 30 percent for products selling between 0.1 and 15 units a day. Inventory objects could include any kind of physical asset: merchandise, consumables, fixed assets, circulating tools, library books, or capital equipment. To record an inventory transaction, the system uses a barcode scanner or RFID reader to automatically identify the inventory object, and then collects additional information from the operators via fixed terminal
Computer terminal
A computer terminal is an electronic or electromechanical hardware device that is used for entering data into, and displaying data from, a computer or a computing system...
s (workstation
Workstation
A workstation is a high-end microcomputer designed for technical or scientific applications. Intended primarily to be used by one person at a time, they are commonly connected to a local area network and run multi-user operating systems...
s), or mobile computers.
Applications
An inventory control system may be used to automate a sales order fulfillment process. Such a system contains a list of order to be filled, and then prompts workers to pick the necessary items, and provides them with packaging and shipping information.An inventory system also manages in and outwards material of hardware.
Real-time inventory control systems may use wireless, mobile terminals to record inventory transactions at the moment they occur. A wireless LAN
Wireless LAN
A wireless local area network links two or more devices using some wireless distribution method , and usually providing a connection through an access point to the wider internet. This gives users the mobility to move around within a local coverage area and still be connected to the network...
transmits the transaction information to a central database
Database
A database is an organized collection of data for one or more purposes, usually in digital form. The data are typically organized to model relevant aspects of reality , in a way that supports processes requiring this information...
.
Physical inventory
Physical inventory
Physical inventory is a process where a business physically counts its entire inventory. A physical inventory may be mandated by financial accounting rules or the tax regulations to place an accurate value on the inventory, or the business may need to count inventory so component parts or raw...
counting and cycle count
Cycle count
A cycle count is an inventory management procedure where a small subset of inventory is counted on any given day. Cycle counts contrast with traditional physical inventory in that physical inventory stops operation at a facility while all items are counted at one time...
ing are features of many inventory control systems which can enhance the organization.
See also
- Automated identification and data captureAutomated identification and data captureAutomatic Identification and Data Capture refers to the methods of automatically identifying objects, collecting data about them, and entering that data directly into computer systems...
- Document automationDocument automationDocument automation is the design of systems and workflow that assist in the creation of electronic documents. These include logic based systems that use segments of pre-existing text and/or data to assemble a new document. This process is increasingly used within certain industries to assemble...
in supply chain management & logistics - Economic order quantityEconomic order quantityEconomic order quantity is the level of inventory that minimizes total inventory holding costs and ordering costs. It is one of the oldest classical production scheduling models. The framework used to determine this order quantity is also known as Wilson EOQ Model or Wilson Formula. The model was...
- Economic Lot Scheduling ProblemEconomic Lot Scheduling ProblemThe Economic Lot Scheduling Problem is a problem in Operations management that has been studied by a large number of researchers for over 50 years...
- Inventory management softwareInventory management softwareInventory management software is a computer-based system for tracking product levels, orders, sales and deliveries. It can also be used in the manufacturing industry to create a work order, bill of materials and other production-related documents. Companies use inventory management software to...
- NewsvendorNewsvendorThe newsvendor model is a mathematical model in operations management and applied economics used to determine optimal inventory levels. It is characterized by fixed prices and uncertain demand for a perishable product. If the inventory level is q, each unit of demand above q is lost...
model - Scan-based tradingScan-based tradingScan-based trading or Scan based trading is the process where suppliers maintain ownership of inventory within retailers' warehouses or stores until items are scanned at the point of sale.-History:...
- Storage management system
- Supply chain managementSupply chain managementSupply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers...
- Warehouse management systemWarehouse management systemA warehouse management system, or WMS, is a key part of the supply chain and primarily aims to control the movement and storage of materials within a warehouse and process the associated transactions, including shipping, receiving, putaway and picking...