Inventory Systems Summary Essay

AbstractTo be masteryful in todays business environment, an scheme mustiness be able to perform certain fundamentals accurately and efficiently. bingle of these elements is having an effective and efficient Inventory System Management (ISM). ISM enables unmatched to make the humpledge of where his or her inscription is at every pace of the way. This allows one to best(p) interact with consumer and make sales. Choosing the right ISM tin weed lead and pave the ground work for future business success and profitability.Inventory System SummaryThe purpose of this group assignment is to join forces as a team to compargon various p arntage systems and severalize the advantage and disadvantages of each system in comparison to the other(a)s. Management of scroll is important to any business that unavoidablenesss to succeed. Companies leverage breed systems to help palm the arsenal of an organization. Team A reviewed the following companies and their origin steering pro grams outgo sully, , and . This Inventory System Summary includes a description of the chosen companies and their scroll systems, and a comparison describing the advantages and disadvantages of each system. take up Buy outflank Buy is the largest consumer electronics store in the gentleman. Each year it increases its presence in the market place share and distances itself fromothers in the industry. Best Buy is headquartered in the Twin cities field of Minnesota, where it handles all main business functions and the leadership that manages its 180,000 employees and 4,000 stores across the globe (Best Buy, 2010). During the preliminary fiscal year, Best Buy accumulated nearly 50 one thousand thousand in revenues and 2.2 billion in operating revenue. They also reported that they have got 18.3 billion in total assets and 6.3 billion in total equity.Best Buy has a large array of merchandise including consumer and commercial furniture, smallish and major appliances, and a wide assortment of consumer electronics. They also poke out an increasingly large list of service. These operate include Geek Squad calculator serve, Best Buy for Business commercial services, and many other services intentional specifically for the end user. They operate stores in many countries across the world however they also operate their lodge online. From their website, Bestbuy.com, many of their wares and services can be ordered and set up for delivery.The different types of convergences and services Best Buy offers in addition to the different options available to purchase and receive their merchandise makes Best Buy a very tight company to maintain. They are no-hit because of the time and gold put into their breed systems. To maintain continuity across the board for all of their partner companies and different store brands they operate , Best Buy uses a similar farm animal anxiety system that allows them to track inventory, along with a transaction attention sy stem that instantly adjusts and updates the world wide inventory both in warehouses and within each store.Most products that Best Buy sales are shipped directly from the manu eventurer to the many warehouses and distribution centers across the US and the world where the stores and online sales can pull and ship directly from. One revision that Best Buy has gone through the past five eld is a switch to a partially vendor based management system. With this new system, Best Buy willing limit the vendors and distributers that they purchase from, and will relinquish some of their inventory control everywhere to them. The innovation created by this new system allows vendors to monitor inventory levels and toship and replenish product as levels get low.Some of the advantages of this system are the advantage of directly supplying to the customer from vendor, which cuts the delivery time shorter, availability of the product, ability to offer products at a lower price compared to Best Bu ys competitors, and the flexibility to further develop other areas of their business. Some of the disadvantages are adjustment the vendors may limit the variety of products, relinquishing inventory control over to vendors and distributors may negatively impact their customer satisfaction, and the customers may decide to take in with supplier directly which could put Best Buy at seek of loosing their business.Inventory levels over the past 4 age have remained on an increasingly consistent track as their revenue has risen. According to Best Buy (2010), this rise in revenue and assets is partly due to the fact that they enter new markets and open new stores across the world. The latest opportunities that they have come across include new stores in Europe and other areas overseas. This is new territory for Best Buy but has been a successful venture based on their flexibility with their inventory systems that they have in place. The following table presents the last five year financi al highlights check to the Financial Statements and Supplementary Data of Annual Report on attain 10-K. (Investor Relations, 2010)DellDell is clearly a giant leader in the information technology world. Dell is an American company with headquarters in Round Rock, Texas. The company develops, sells and supports computers and related products and services. The company got its birth in 1984, founded by Michael Dell. Dell has become one of the roughly admired companies in the electronic industry. According to Fortune Magazine, Dell is listed as the 38th largest company in the United States. Based on total revenue, Dell is the 5th largest company in Texas and the 2nd largest non-oil company in Texas (Wikipedia, 2010). So, how does Dell do it? Managing its inventory base is an indication.From its early beginnings, Dell set the bar. Dell uses the just in time (JIT) approach in the manufacturing facilities. By using this technique, Dell can minimize its inventory cost. In an industry that rapidly changes, maintaining low inventory levels is one key factor to survival. According to jetty Street ledgers MarketWatch (2010), the following table provides asnapshot portion of the financials record for Dell from its balance sheet. Annual Financials for Dell, Inc.According to Wikipedia (2010), just-in-time (JIT) is an inventory strategy that is designed aide in improving a businesss bring forth on investment by reducing in-process inventory and any carrying cost associated. JIT production method is also known as the Toyota Production System. JIT plant with of use of signals at different points in the manufacturing process. The signals indicate the presence or absence of a part or the deprivation to make another(prenominal) part. If JIT processes are implemented correctly, it can improve an organizations return on investment, quality,and efficiency. It is preferably simple the philosophy behind JIT is inventory is waste and Dell has try to capture that philosophy.Wal- MartThe worlds largest and most profitable retailer, Wal-Mart continues to expand its stress in the US and worldwide. To do this, Wal-Mart has to track what is selling, what isnt, and what products its over 3,740 stores nationwide study whether it be their discount stores, supercenters, or neighborhood markets. The below excerpt from the 2010 yearbook report (2010 annual report-walmartstores.com, 2010) shows the level of inventories that Wal-Mart has maintained for the last four years (Amounts in millions except per share and unit count data)With an average of $34m in inventory, cosmos valued under the LIFO last in starting signal out- method take foring track of it is of major importance to the retail giant. To take note track of its inventory, Wal-mart and Sams Club use electronic product code (EPC) labels to make sure the products you want are available when you need them (walmartstores.com, 2010). What is an EPC? The EPC is a lot like a bar code that most stores use. W al-Mart uses the EPC because the information that can be tracked about the product being purchased includes what the product are, who are the manufacturers, and other specifics like color, size, style, and more.The information provided by the EPC allows Wal-Mart to better manage the inventory on hand, making sure the store provides its customers with what they want, when they want it. How does EPC work? EPC labels consist of a unique number that can be tied back to a specific piece of merchandise. Using special(a) readers, and through the magic of RFIDs, the EPC doesnt have to be scanned directly for them to be read by the computers. This means that Wal-Mart can count thousands of items in seconds and know which products are out ofstock (walmartstores.com, 2010). The products that Wal-Mart is tracking with the EPC are easy to find.They are identified by an EPC symbol. What does EPC mean to consumers? The ability to track finite inventory information is important as it ensures that the retail giant can keep products in stock that consumers want. Amazingly, with all the information that the EPC tracks, there is no aggression of privacy to the consumer. The EPC does not collect personal information when purchased. Labels are not tracked once the actual merchandise is bought and leaves the store.ComparisonThe different inventory systems used by each organization share a third estate goal. The system tracks the inventory for each company allowing them to hopefully save money by knowing where items are and what needs to be purchased. Each organization emphasizes inventory control and recognizes the effects of inventory management on their boilers suit profitability. To this end, many of the companies use a variation of bar coding or Radio-frequency identification (RFID) to track inventory. Each organization also ties inventory management to an awareness of demand this allows the organization to quickly react to changing market conditions.ConclusionBecause invent ory is possibly the largest current asset listed on a organizations financial statement, correct inventory management is at the heart of a businesss success or failure.References2010 Annual Report Walmartstores.com (2010). Retrieved on January 10, 2011 from http//cdn.walmartstores.com/sites/AnnualReport/2010/PDF/WMT_2010AR_FINAL.pdf Best Buy (2010). Company Reference Best Buy. Retrieved January 11, 2011 from http//www.answers.com/topic/best-buy-co-inc Dell. (2010). Wall Street Journal MarketWatch. Retrieved January 12, 2011, from http//www.marketwatch.com/investing/Stock/DELL/financials/balance-sheet Hoyt, W. (2002). The basics of inventory tracking. Retrieved on January 10, 2011 from http//www.essortment.com/career/smallbusinesst_tuag.htm