Investigates various aspects of inventory, a major retail asset with considerable impact on profits and liquidity. It is argued that inventory requires constant attention as a result of the complexity of the South African retail market, change, competitive pressures, and costs eroding profits. The strategic controls of a clearly defined policy on the market to be served and the objectives to be achieved are obtained through careful planning, good forecasts and realistic budgets. Once the optimal level of stocks has been determined, it is possible to establish and construct the type of control system to be exercised. Value control may be supplemented by unit or selective control systems. It is necessary for the marketing function to classify and define the product assortment to be carried. A policy is established on the purchasing activities and a budget is drawn up to control operations. Thereafter, the funding requirements and method of inventory financing need to be determined. Custodial controls are designed to safeguard stocks from the time the order is placed until such time as the stock is sold. The recording and processing of information provides data for evaluating the effectiveness of operations. The manner in which stocks are valued, subject to certain legal requirements, may have a significant effect on the financial statements. Computers are able to process and manipulate vast quantities of data, despite a number of drawbacks that exist. The management hierarchy will define the decision-making levels and allocate authority and responsibility. Ultimately, successful control rests with the calibre of staff employed. In conclusion, there are opportunities for creative management to meet the challenges that a dynamic environment exercises over the merchandise proffered to the customer.
|Subject||Business administration / Business leadership|
|Subject 2||Business administration / Business leadership|
|Degree Type||Masters degree|