CHAPTER ONE
1.0. INTRODUCTION
1.1. BACKGROUND TO THE STUDY
Stock Management System is a process of managing and locating objector materials. In common usage, the term may also refer to just the software components. According to (Kotler, 2000), stock management refers to all the activities involved in developing and managing the stock levels of raw materials, semi-finished materials (work-in- progress) and finished good so that adequate supplies are available and the costs of over or under stocks are low. (Rosenblatt, 1977) says: “The cost of maintaining stock is included in the final price paid by the consumer. Good in stock represents a cost to their owner. The manufacturer has the expense of materials and labour. The wholesaler also has funds tied up”. Therefore, the basic goal of the researchers is to maintain a level of stock that will provide optimum stock at lowest cost.
(Morris, 1995) stressed that stock management in its broadest perspective is to keep the most economical amount of one kind of asset in order to facilitate an increase in the total value of all assets of the organization – human and material resources. (Keth et al. ,1994) in their text also stated that the major objective of stock management and control is to inform managers how much of a good to re-order, when to re-order the good, how frequently orders should be placed and what the appropriate safety stock is, for minimizing stock outs. Thus, the overall goal of stock is to have what is needed, and to minimize the number of times one is out of stock. (Schroeder, 2000) who stressed that stock management has an impact on all business functions, particularly operations, marketing, accounting, and finance. He established that there are three motives for holding inventories, which are transaction, precautionary and speculative motives. The transaction motive occurs when there is a need to hold stock to meet production and sales requirements.
A firm might also decide to hold additional amounts of stock to cover the possibility that it may have under estimated its future production demand is uncertain. The speculative motive for holding stock might entice a firm to purchase a larger quantity of materials than normal in anticipation of making abnormal profits. Advance purchase of raw materials in inflationary times is one form of speculative behavior
Organizations have to acquire, allocate and control the factors of production that are necessary to the achievement of its objectives. stock management as one of the key activities of business logistics, has always been a major preoccupation of an organization‘s survival and growth. Solomon and Pringle (1977), defines stock as a physical resource that a firm holds in stock with the intent of selling it or transforming it into a more valuable state. A stock system is the set of polices and control that monitor levels of stock and determine what levels should be maintained, when stock should be replenished and how large orders should be. This is important for an organization such as TASO organisation which aims at availing drugs to people bearing mind that the health of the people is a basic need for man’s survival and nation development.
1.2 STATEMENT OF THE PROBLEM
Manual system are quite tedious ,time consuming and less efficient and accurate in comparison to the computerized system.
So following are some disadvantages of the old system:
1. Slow data processing
2. Lot of paper work
3. Time consuming
4. Less accurate
5. Less efficient
6. Lot of paper work
7. Slow data processing
8. Not user friendly environment
9. Difficult to keep old records
1.3 OBJECTIVES OF THE STUDY
The project is designed to help in the management of stock. The main objective of the new system includes:
1. Design a computer – driven stock management system to keep record and track materials on the basis of both quantity and value.
2. To generate reports on all the activities in the store
3. Design and develop a central database system that would serve as store database, which will contain information on all the available product in the store.
1.4 SIGNIFICANCE OF THE STUDY
The new system designed for computer driven stock management system will among other things:
1. Financial records specific to a single component, or groups of components.
Service records for all components in the stock.
2. Up-to-date information about data processing resources through the creation and
archiving of records in a centralized repository.
3. Data used to support configuration diagrams of the hardware and software
components contained within specific locations, or the entire data processing
environment.
1.5 SCOPE OF THE STUDY
The scope of this system is to provide user efficient working environment and more output can be generated through this. This system provides user friendly interface resulting in knowing each and every usability features of the system.
This system helps in tracking records so that past records can be verified through them and one can make decisions based on the past records. This system completes the work in a very less time resulting in less time consumption and high level of efficiency.
This system is developed in such a way that even a naïve user can also operate the system easily. The calculations are made very quickly and the records are directly saved into databases and the databases can be maintained for a longer period of time. Each record can be retrieved and can be verified for the future transactions.
Also this system provides high level of security for data leaking as only admin people can access the database no changes can be made in it until it verifies the user login id and password.
The research will be carried out using OGUN STATE INSTITUTE OF TECHNOLOGY, IGBESA BOOK SHOP.
1.6 LIMITATIONS
The constraints encountered during this project design include the following:
1. Financial Constraints: The design was achieved but not without some financial involvements. One had to pay for the computer time. Also the typing and planning of the work has its own financial involvements.
2. High programming Technique: The programming aspect of this project posed a lot of problematic bugs that took us some days to solve. Problems such database connections using VB and MS Access database posed a lot of challenges.
3. Few Literature Sources: The topic though seems to be a common term; it is not a popular topic to surf from the Internet. It had fewer literature sources.
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