Inventory control may be defined as ” the systematic control over the procurement, storage and usage of materials so as to maintain an even flow of materials and at the same time avoiding excessive investment in inventories”.
It means control over materials lying in store. Inventory control keeps continuous track of inventories. But it is not merely record-keeping. Inventory control aims to achieve maximum possible inventory turnover.
According to L.V. fine___” The planning and scheduling of materials used in the manufacturing process. It is possible to exercise control over the three types of inventories recognized by the account as raw-material, work-in-progress and finished goods”.
According to John L. Burbidge___” Inventory control is concerned with the control of the quantities and/or monetary value of these items a predetermined level or within safe limits”.
Thus, it is a technique of maintaining stock keeping items at the desired level, whether they are raw materials, goods in process or finished products. Inventory control keeps track of inventory. The balance between high level and low level can be done by means of effective inventory control. Thus, it managing the following aspects:
- Size of inventory-determination maximum and minimum levels,establishing time schedules, procedures and lot of size for new orders, ascertaining minimum safety levels, coordinating sales, production and inventory policies.
- Providing proper storage facilities arranging the receipts,disbursements and procurement of materials, developing the forms of recording these transactions.
- Assigning responsibilities for carrying out inventory control functions.
- Providing for the reports necessary for supervising the overall activity.
Objectives of inventory Control
- To ensure adequate supply of products to customer and avoid shortages as far as possible.
- To make sure that the financial investment in inventories is minimum.
- Efficient purchasing,storing,consumption and accounting for materials is an important objective.
- To maintain timely record of inventories of all the items and to maintain the stock within the desired limits.
- To ensure timely action for replenishment.
- To provide a reserve stock for variations in lead times of delivery of materials.
- To provide a scientific base for both short-term and long-term planning of materials.