Task 6: Inventory

WHAT IS INVENTORY?

v  Any quantifiable item that you can handle, buy, sell, store, consume, produce, or track can be considered inventory.

v  This covers everything from office and maintenance supplies, to raw material used for manufacturing, to semi-finished and finished goods, to fuel used to power equipment used in the business.

WHAT IS INVENTORY?

1.       Goods for resale

2.       Consumables

3.       Packing material

4.       Stock items

•          Raw materials

•          Work In Progress (WIP)

•          Semi finished Goods (SFG)

•          Finished Goods (FG)

EXAMPLE OF  INVENTORY?

1.       Goods for resale – paper, wood, boxes, TV

2.       Consumables – paper, fuel, glue

3.       Packing material – wood, boxes, plastic

4.       Stock items –

•          Raw - screws, wood, resistor, fabric

•          WIP - Screws, wood, resistor, fabric

•          SFG- Table top, drawer, motherboard

•          FG – Table, TV

    

MEANING OF TYPES BY STOCK ITEMS.

RAW MATERIALS-

•          materials and components scheduled for use in making a product

WORK IN PROGRESS(WIP) –

•          materials and components that have begun their transformation to finished good

SEMI FINISHED GOODS

FINISHED GOODS

·         goods ready for sale to customers.

HOW DO WE IDENTIFY INVENTORY?

ü  DESCRIPTION

–        Specific

–        Measurements

               Example:-

1.       Flour     –             corn, wheat, tapioca

2.       Screw    –             M6X16 Pan Head M/C Screw-R/P                            

3.       Cable    –             32W X 0.5MM(SQ)

                                                              32W X 0.4MM

ü  ITEM NUMBERING

–        Unique

–        Have meaning

               Example:-  Books                         

                                        

                                                                     

                                                                       

               Example : resistor colour code

                              

RESISTOR COLOUR CODE

–        1 KΩ, 1/4 W, 5%, leaded resistor

                        

                  

                                                          

HOW DO WE IDENTIFY INVENTORY?

Other examples of item numbering

•          880804-81-5002

•          670001

•          DB-02-J9                                               

•          8645 TISP218

•          46ND012-P

•          F26-71763-36

•          YY-1605-TTMA

·         AMP 0-102241-2


      EXAMPLE :  

SCANNING ITEM CODE

    

ü  UNIT OF MEASURE

–        Quantity of the material

–        Standard packing

WHAT OTHER INFORMATION IS NEEDED FOR AN ITEM?

•       Brand

•        Supplier

•        Purchase price

•        Selling price

•         Product Group

•       Component

•       FG

•       Service

•       Stockable/non-stockable

PRODUCT CODE

·         Finished goods and Semi Finished goods must also have item numbers or product codes.

               

·         Besides having a product code, a Bill of Material (BOM) must also exist.