Stock Company Management involves managing the inventory of products that your business plans to sell. It involves purchasing, storing and tracking inventory, as well as recording any changes. It could also include predicting the need, reducing costs, and having the appropriate amount of each product in the storehouse to be able to meet sales forecasts.
The most efficient method for managing cashflow will depend on the size of your company as well as the type and size of stock you hold. Smaller businesses track their inventory manually, using spreadsheet formulas or order points to reorder. Larger companies could use enterprise resource planning software.
Costs associated with holding stock could include purchase costs, storage charges, labor costs to pick, pack and store the stock before it is sold, and waste or spoilage. You can reduce structural costs by implementing a solid stock control system that includes regular stocktakes, ensuring that you are aware of the inventory available at any time. A stocktake compares the data of inventory sold and bought with the inventory of physical items on hand, identifying lost, stolen, soiled or damaged items that you can claim as an expense or deduct against the value of the goods sold to make accounting sense.
Stock turnover is a crucial measure. It’s the number of times stock is purchased and sold in a period. One important measure is stock turnover which is the number of times stock is purchased and sold over a time. This ensures that there is always less stock than sales and eliminates the need to store or pay for dead stock.