Stock Control System
What does a stock control system do?
Stock control and inventory management are somewhat synonymous terms, with companies in the United States using the term inventory management and English speaking countries elsewhere in the world generally using the term stock control. We use the terms interchangeably.
Stock control is the process by which a company keeps track of its stuff. For a small and medium sized businesses, keeping track of stock items with Excel or pencil and paper may be sufficient, but as the business grows so does the complexity of the task. Eventually a company adopts a stock control system to bring organization and consistency to its records.
Basic concepts of stock control
For wholesalers, distributors, and retailers, the “stuff” that the business keeps track of is products bought from suppliers and sold to customers. For manufacturers, stuff includes the parts or ingredients that go into making the products, in addition to the products themselves. For restaurants, stuff includes the ingredients and supplies that go into the food served. For service businesses that rent items to customers or for businesses that need to keep track of their own equipment, stuff includes the assets that remain in the possession of the business but change location (asset tracking). There are many different kinds of stuff used by different kinds of businesses, but the basic concepts of stock control are remarkably similar across all of them.
The top level concepts involved are suppliers, purchases, stock, transfers, work orders, sales, and customers. Reading left-to-right, you can follow the path from which products or parts are purchased from suppliers into company stock, assembled, and sold through purchases to customers. The block diagram varies slightly for different types of businesses: wholesale and distribution, manufacturing, and retail and restaurants. However the concepts are the same.
Intermediate concepts of stock control
At the next level of detail, the concepts of stock control address situations that occur in the real world. Purchases and sales, for example, may be be shipped across multiple shipments, or a shipment may not contain what is specified in the sales or purchase order. Introducing the concept of shipments as distinct from purchases and sales accommodates these situations.
Stock control systems in small and medium sized businesses are often separate from the company’s accounting system. If you use Quickbooks or Excel for your accounting, then the purchases and sales are the interface points between inventory and accounting. Introducing quotes and invoices to the sales completes the main concepts for order management software, and lays out the files that can be imported and exported between your inventory and accounting system.
In the simplest of scenarios, stock levels are merely quantities of items, but in practice stock levels are sometimes a bit more involved. Stock is stored in different warehouses, and within those warehouses in bays, or aisles or bins. Keeping track of stock levels entails keeping track of quantities per location. Items may be stored individually (“eaches”) or packed into cases or handling units. Many businesses keep track of not just quantities of stock, but also the packing. Some types of products have expiry dates, or serial numbers, or other properties identified by lot or batch. Thus stock may not just be quantities of a particular product, but of a particular lot.
Detail concepts of stock control
Deeper levels of detail address such topics of price discounts, tax authorities, multiple addresses, and so forth. You can imagine, though, how each level of detail fits into the framework above it. With these levels of detail in hand, you can navigate the subjects of a stock control system and focus on the details that are most pertinent to your business.
Barcode systems as part of a comprehensive stock control system
For a stock control system, it bears mentioning that barcode systems are often employed in the tasks that require counting large numbers of physical items: stock takes, receiving shipments, packing orders, and shipping orders (or transfers). Barcode systems provide a method of labeling and identifying products with a barcode scanner for purpose of counting them quickly and with a minimum chance of human error.
Most small and medium sized companies start keeping track of their stock with some sort of a stock control software before incorporating using barcodes and barcode scanners. If the goals of your business systems are to reduce human error and increase efficiency, the best practice is to begin by identifying the process points that are in most need of improvement. If the pressing problems center around the physical processes of counting, then investing in a barcode system early makes sense. If records are inconsistent or wrong tracing back more to organization than to miscounts, then it may make sense to start out with stock control software and incorporate barcoding when you have a clear understanding of the benefits.
Examples from Finale Inventory
To learn more about the lot tracking capabilities of the cloud inventory management, please check out the capabilities and video tour to get more insight to learn if Finale may be good fit for your application.
Here are a few example videos of using Finale Inventory to create a product or a sales order.
Overview (simple example)
Importing a product list from Excel
Creating large sales orders (quickly)