Stock Company Management involves managing the inventory of items your business plans to sell. It includes purchasing, storing and tracking inventory and keeping track of changes. It can also involve predicting the market, reducing costs, and ensuring the correct amount of each product in the storehouse to meet sales forecasts.
Keeping track of inventory and knowing when to purchase more is essential for ensuring cash flow, but the ideal system will differ based on your business size and the type of inventory you hold. Smaller companies typically keep their records by hand, using spreadsheet formulas as well as points to reorder, while larger companies might employ more sophisticated enterprise resource planning (ERP) software.
Costs of holding stock could include storage charges, labor to pick, pack and store the stock prior to when it is sold, and spoilage or waste. You can reduce the structural cost by using a reliable inventory control system, which includes regular stocktakes so that you are aware of the inventory available at any time. Stocktakes compare the records of inventory sold and purchased to the physical inventory in hand. It helps you identify dirty, stolen, or lost items or damaged items that you can write off or deduct from the price of goods sold.
Being able to manage the right amount of inventory can help you set profitable prices, however, too much will tie up cash and increase the costs of storage and disposal. Stock turnover is an important measure. It is the amount of times stock is purchased and sold over a given period. This ensures that there isn’t more stocks available than sales, avoiding the need to purchase and store deadstock.