Inventory management technology

Overview

Barcodes and RFID, perpetual inventory, reorder levels with a worked calculation, just-in-time, EDI with suppliers, cloud inventory systems and their costs.

What you need to know

Answer each one before you reveal it.

Questions from this subtopic

Each one with the model answer underneath.

1. 1

   How do barcodes support inventory management?

   Model answer

   Scanning a barcode identifies an item instantly as it is received or sold. Stock records update without manual keying errors.

2. 2

   What is RFID, and how does it differ from barcode scanning?

   Model answer

   RFID uses radio tags that can be read at a distance without line of sight. Many tagged items can be read at once, whereas barcodes are scanned one at a time.

3. 3

   What is a perpetual inventory system?

   Model answer

   A perpetual inventory system updates stock levels continuously as each item moves. Managers always know current stock without a full count.

4. 4

   How does an IMS use a reorder level?

   Model answer

   The system triggers an order when stock falls to a set level. The reorder level allows for usage during the supplier's lead time.

5. 5

   A client uses 40 units a day and its supplier takes 5 days to deliver. The client keeps 100 units of buffer stock. What should the reorder level be?

   Model answer

   The reorder level should be 300 units. The working is 40 × 5 = 200 units used during the lead time, then 200 + 100 buffer = 300 units.

6. 6

   How does an IMS link with the tills in a retail business?

   Model answer

   Each sale recorded at the till reduces the stock record automatically. Fast-selling lines are flagged for reorder without a manual check.

Other ways to work this

The same content, four other ways.

What is inside Levo

Six ways to work the same material.