STOCK CONTROL
Stock levels are often controlled in retail stores by IT systems although most organisations require some stock to be kept. Stock Control is important because some items can be re ordered quickly when stocks are getting low. A good example of this is a CD store, when thousand of CDs and cassettes are sold each day. To ensure the shelves are always well stocked and up to date with the latest albums and IT system is used. So the title of each song is given a stock code and this code is logged on the store computer. On the back of each piece of merchandise (e.g. T-shirt, Posters etc) is a bar code. This bar code is registered alongside the stock control and title of the music.
As soon as a CD or tape is sold the Sales Assistant uses a bar code reader (EPOS) to scan the bar code. The computer displays the price on a small screen, and prints a receipt for the customer. At the same time it logs the title and artist and keeps track throughout the day of every sale. At the end of the day the computer calculates all sales and compares the number of sales to the quantity of stock shown in the computer file. So any title no longer in stock is re ordered. This example illustrates the use of bar codes.
PAYROLL PROCESSING
Most companies use computers to calculate employee salaries and wages. Every company or business has to pay its employees. Although this looks like a straightforward task it isn’t as all employees have tax and National Insurance. These contributions have to be deducted from the wages before they are paid. It is complicated further when you realise that tax to be paid depends on total income and on taxable benefits such as company cars. Extra payments such as overtime also mean that the payments are unlikely to be the same from one week or month to the next.
To make payroll processing easier and simpler there are a number of standardised software packages available fed with the information. On it just mentions about each employee, they calculate the weekly or monthly payroll.
The Commercial System, which I am going to describe, is Stock Control. The Commercial Organisation that I am going to describe is Morrisons.
HOW STOCK CONTROL IS DONE AT MORRISONS
At Morrisons the sales made at each checkout are recorded in the daily sales file as the goods are sold. At Morrisons they record the product code of each item sold. At the end of each day the individual product codes are read from this file. The quantity of each item sold is calculated and a report printed shows the product code, name of product and the total number of each product sold.
E.g.
This information is used to update the stock control file. This stock control file contains a record of each product.
- Product Code e.g. 123456
- Number in Stock e.g. 800
- Re Order level e.g. 1000
For each product, the total number sold that day is subtracted from the number in stock, which is updated. In the above example the total number of Brown Bread sold is 300. The number in stock is 800, so the updated number in stock is 800 less 300 i.e. 600.
THE NATURE OF THE BUSINESS
Morrisons is one of the leading chains of supermarket across the UK. There is at least one store of Morrisions in each town. They sell various sorts of products from household goods to fresh fruit and vegetables. Throughout the stores there’s a range of more than 20,000 different products on display, these include extensive own label range, which is continually being developed, and many favourite top brands. There are various offices of Morrisons across the UK so any enquiries can be made sufficiently and effectively.
On the map below it shows some of the Morrison offices in England.
MAP OF THE BRITISH ISLES SHOWING VARIOUS OFFICES OF MORRISONS
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THE EQUIPMENT USED
Morrisons uses different equipment to contact its offices, which are situated all across the UK as you can see from the map above. They use the Internet, Email and the Telephone. But within the store they use the Electronic Funds Transfer (EFT), Electronic Point of Sale System (EPOS). Point of Sale terminal used to read bar code printed on items. A Dot Matrix printer is used to print receipts.
THE PEOPLE INVOLVED
There are many people involved with Morrisons from the employees to the managers. At Morrisons they need lots of workers. Some work on the tills. Other people work in the frozen food department and others on the trolleys.
On the diagram below it shows some of the people involved.
THE DATA COLLECTED
At Morrisons the data that they collect is through bar codes for example when some one buys a product the information of the product appears on the main computer. So at the end of the day the store manager looks and sees what items have been sold. It also shows them how many items have been sold and which was the most popular item sold.
THE INFORMATION PRODUCED
The information collected by Morrisons is how much profit they have made throughout the different regions and what products they can use to increase there sales. E.g. get more tins of Baked Beans if the sales have been well.
OPERATIONAL RUNNING OF MORRISONS
The store manager makes the day to day decisions of the store. He decides if there are enough workers to manage the tills. The store manager also decides if some products can have a discount price for the day.
DECISION MAKING
The regional manager makes the medium term decisions of Morrisons. He decides if there is enough bread or milk to meet the demands of the customers. He can also decide if there needs to be a new product on sale if one isn’t doing so well. If the regional manager decides another store needs to be opened he send a letter to the head office with all the profits to see if it’s a good idea. When its summer the manager also has to decide if he wants to stock items like Garden stuff etc.
PLANNING
The director makes the long-term decision making of Morrisons (Planning). The director also thinks about the future of the business. He decides if more stores need opening and in which town or country.
CONCLUSION
ADVANTAGES OF USING A COMPUTER BASED STOCK CONTROL SYSTEM
Computer based stock control system allows the manager to monitor stock levels closely. This allows the manager to increase its profits and improve customer service. This system is also quicker and fewer mistakes tend to occur at the checkout.
DISADVANTAGES
The cost of this system is too high and you will also need to train your employees to use this system.
