CHAPTER 1
INTRODUCTION
1.0 Introduction
Inventory management is a challenging problem area in supply chain management.
Companies need to have inventories in warehouses in order to fulfil customer
demand, meanwhile these inventories have holding costs and this is frozen fund that
can be lost. Therefore, the task of inventory management is to find the quantity
of inventories that will fulfil the demand, avoiding overstocks.
Inventory management is system determine the sufficient amount and type of input
1products, products in process and finished products, facilitating production and
sales operations and minimizing costs by keeping them at an optimal level and that
aids the management of the Customers’ data, company employee data, sales’
registration, Credit report, inventory report, invoices, purchasing and other
operations of company.
1.1 Problem statement
This software, “Inventory Management System”, is used for recording the information
about the day to day transaction of stocks of an organization. It stores purchase
information of the products with credit/debit information from the supplier. Similarly, it
stores sales information with credit/debit about the customers. If a product is purchased,
then the related information is stored in stocks, that is, stocks are up to date. Another part
is it prepares sales report after product is sold. In the sales information, the information
about who sold the product is also kept, so there is no problem for misunderstandings in
future.
1.2 Goals and Objectives
1.2.1 Research Goal
The main gaol of this project is to create and develop an inventory management system
that can be used for the operations and daily activities. Another aim of the entire system is
to build a system that can control all the operations that taking place in companies, and to
reduce errors and mistakes that always happen when using the current manual system
(book and pen).
1.2.2 Research Objectives
To collect all activities reports that the company made.
To reduce data loss, data redundancy and etc.
To developed a system that will improve the work performance of the
company.
To determine the best solutions for problems of the old system.
To secure information of the company and save data.
To analyse how the developed system will be a solution for the problem.
1.3 Scope
1.3.1 Geographical Scope
This study will focus only in some areas, the capital of Somaliland, Hargeisa and
Buro’ city can be mentioned, Lauren Brands headquarters.
1.3.2 Time Scope
The duration of this study will kick off from May 21 st, 2024 and will be closed ….
According to our estimations.
1.4 Significance of Project
Any venture that handles stock will need a system to accurately track and control it.
Without one, you’ll be working on an entirely ad-hoc basis — and you’ll quickly run
into situations where your business is overstocked or understocked.
A recent report revealed that retailers with more than 60,000 products can reduce the
labour costs of manual stock audits by over USD 70,000 per year with an automated
inventory management system. And they offer plenty of advantages for smaller
operations as well (1).
Here are five benefits of inventory management systems:
Greater inventory visibility – inventory systems allow you to track all your
inventory movements, so you always know how much stock of each item you
have, where it’s located, and when to reorder.
Meet customer demand – an accurate system can help you reduce stock outs,
meaning you never miss out on potential sales and are able to provide good
customer service.
Understand your profitability – by recording all your inventory data in a
system, you can break down the costs of producing and selling goods. This is
useful for understanding the total value of your inventory and determining
profitability at the product and business levels.
Improves workflow efficiency – when you use a system to track and manage
inventory, you don’t have to manually check how much stock is available
every time you need to know.
Essential for accurate financial reporting – accounting for inventory is
impossible if you don’t keep track of your stock and purchases. Inventory
management systems provide an effective way of monitoring the true value
and profitability of your business.
1.5 Tools and Methodologies
1.5.1 Tools
For the development IMS system a variety of tools and techniques are used. For the
development of the system the user requirements has to be written in the
understandable form. The use of different graphical representation of the system
process has been implemented in development of system for non-technical users to
understand the system working process. We used common Tools and techniques for
system development as:
Net Beans IDE (Coding)
JDK 1.7_3
MySQL server
MS Visio (Designing)
MS Word (Documentation)
Adobe Photoshop (Graphic Designing)
1.5.2 Methodology
We use waterfall model, since it’s very simple to understand a use in water fall
model and each phase must be complete fully before next phase can begin.
1.6 Schedule
No Start Task End Resource
Duration Duration
00 24th March Group members 24th April University’s
and Supervisors Camp
01 06th May Project proposal 14th May Group
and Chapter_1 Members
