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Introduction
Explanation for the reason behind something
Inventory systems are real-time tracking systems that keep businesses informed about the quantities of raw materials, supplies, and final products on hand. The systems are updated continuously as items are sold or raw materials are used to create products, enabling businesses to have a clear understanding of their available inventory for upcoming days or weeks. By implementing such systems, businesses can strategically place orders in advance to guarantee they always have necessary supplies.
Inventory systems have transformed business transactions by simplifying them with just a few keystrokes and reducing paperwork.
Technology has greatly improved modern life, as society becomes more dependent on it. Computers in the workplace increase productivity and efficiency.
The Paper Mill currently utilizes a manual inventory method for each item, requiring time and effort. The researchers aim for the proposed computerized inventory system to be beneficial for the company. Implementing the system will reduce time spent on payment calculations and improve customer satisfaction.
Background of the Study
Danao Paper Mill ceased operations in 1984 due to economic challenges while managed by Durano Company.
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The mill, known for producing 65 grams per meter paper for cement packaging, was eventually repossessed by a bank and put up for auction. Mr. Frederick Ong overcame obstacles to acquire ownership through this process. Rehabilitation began in 2000 and concluded by mid-2002 despite difficulties in obtaining permits. Finally, on June 6, 2006, the paper mill officially reopened after four years of permit acquisition.
Inventory refers to the overall quantity of goods and materials held by a factory, store, or business.
An inventory system is a technique employed by businesses to manage their stock of available goods and materials, which can vary from a basic manual count performed daily to monitor the flow of incoming and outgoing items. Paper Mill Inc. encounters difficulties in their inventory system including human error, time consumption, and security risks.
Developing an automated inventory system is beneficial due to the time-consuming and error-prone nature of manual inventory processes. This system will automate transactions from acquiring product descriptions to updating the inventory database, enhancing employee efficiency by streamlining tasks such as recording product information. By eliminating the need to constantly input product details, the system will also improve accuracy and free up time for more productive activities.
This section focuses on the theoretical framework.
The team's proposal for the Computerized Inventory System involves intentionally disrupting the flow of materials in order to develop organized stocks. A key component of the Inventory System is the need for storage, whether it be a room, building, or designated area. The influx of items into storage is referred to as storage input, while items leaving storage are considered as storage output. Thus, the inventory system encompasses all activities and considerations related to the storage of items. This includes technical and logistical aspects such as storage layout, as well as broader questions concerning a company's overall stock.
Numerous mathematical models have been created to address the crucial decision of inventory quantity, all falling under the umbrella of Inventory system in Operations Research.
The outflow of stock in a retail market is driven by customer sales, while the replenishment is obtained through orders. Proper stock management involves ordering the correct quantity (lot size) at the appropriate time. Higher order quantities result in increased storage costs, while fewer orders lead to lower order costs. Maintaining a large inventory ensures a higher level of service and enables the fulfillment of most customer needs. Key inventory issues include order costs, storage costs, and service level to meet customer demands.
Long-term inventory system issues are not relevant here because order costs are viewed on a global scale rather than for individual orders. Intermediate storage is closely tied to production, so it does not present a distinct inventory problem. However, principles from inventory system theory can still be applied to managing intermediate storages.
Conceptual Framework
Stock management is crucial for organizations and a well-organized inventory system provides proper control of stocks. This study will utilize the input-process-output diagram to develop a computerized inventory system for Paper Mill Inc.
The initial variable in this study is the current inventory system of PMI, which has been assessed through interviews and observations conducted by the researchers. This will encompass the policies and procedures established by management for the procurement, receipt, storage, distribution, and documentation of inventory.
Process After identifying the inputs, the current inventory system of PMI will undergo evaluation using the SWOT analysis. Once the strengths and weaknesses of the current system are identified, computerization of PMI's inventory system will commence. This phase will incorporate management and accounting theories, concepts, and techniques to improve the current system, while also considering the organizational requirements of PMI. Prior to finalizing the output, feedback from management will be solicited for comments and suggestions to be incorporated into the final output.
The output of the project will be a computerized inventory system for PMI, developed through careful analysis and discussion between the researchers and the client's management.
Fig. 1.4 Conceptual Frameworks
Statement of the Problem
The Paper Mill faces a common issue with their inventory system - it is inefficient and time-consuming due to manual mandates. This manual process also puts the data security at risk and increases the chances of inaccurate data. The authors have identified these problems with using a manual inventory system.
Importance of the Research
The system will offer a quicker way for the owner and employees to record transactions and count supplies. It will provide a more efficient and reliable digital system for recording transactions, which will greatly benefit them as they currently do it manually. Time is crucial in business transactions; using traditional methods of computation and recording can be time-consuming. This system aims to reduce this time and allocate it to more essential tasks.
Enhancing Efficiency: Implementing a Computerized Inventory System. (2016, Oct 19). Retrieved from https://studymoose.com/computerized-inventory-system-essay
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