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INTRODUCTION "Inventory" to many business owners is one of the more visible and tangible aspects of doing business. Raw materials, goods in process and finished goods all represent various forms of inventory. Each type represents money tied up until the inventory leaves the company as purchased products. Likewise, merchandise stocks in a retail store contribute to profits only when their sale puts money into the cash register. In a literal sense, inventory refers to stocks of anything necessary to do business. These stocks represent a large portion of the business investment and must be well managed in order to maximize profits. In fact, many small and large businesses cannot absorb the types of losses arising from poor inventory…show more content…
Source : 3.1 THE BEST SYSTEM FOR KRISTENS SITUATION The best system for kristens situation is to first of all get an depth understanding of how moving averages works and also the knowledge of how the computer software used in the farmers restaurant works in relation to: Inventory Orders * Inventory management systems help businesses order inventory by accurately recording consumer sales. Electronic inventory systems can track sales in a real-time format, ordering inventory automatically when current stock hits a predetermined minimum level. Electronic ordering, known as Electronic Data Interchange (EDI), allows companies to maintain the proper amount of stock by not increasing costs through over-ordering of inventory. EDI also ensures that orders are placed immediately, ensuring short amounts of lead time to receive new inventory. Stock Maintenance * Computerized inventory management systems allow companies to properly order and maintain several different types of goods. Different styles, colors or sizes can easily be managed to ensure that consumer demand is met through offering a variety of goods. Most companies use inventory management to keep stock items separate from similar goods; this allows management to determine which items are selling well and which items need to be reduced from inventory based on poor sales. Price Levels * Properly managing goods

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