Inventory Proposal
Misty Gregory, Jennifer Hue, David Hypes, Calvin Moy, Mauricio Parra
QRB 501
February 25, 2013
Julianne Manchester
Businesses today understand the importance of maintaining accurate inventory for best business practices. Volume of supplies high or low, extreme markdowns, sluggish inventory turnover, and sluggish cash flow are issues for merchants with seasonal demands. Good recording keeping of inventory affords the company to maintain customer satisfaction, excellent customer service internal and external, operational efficiency, eliminate challenges with manufactures, and to enhance company growth, and revenue (Sevilla, 2007). Team A will illustrate the Costco Wholesale Corporation, and Real-Time inventory system used by the company displaying challenges with the inventory system. The team will explain the future benefits that motivate the company to apply a solution. This document will exhibit a breakdown of the Winter Historical Inventory data provided by University of Phoenix. Create a histogram of the Winter Historical Inventory statistics using Microsoft excel. Team A will also measure the seasonal indices to evaluate the inventory data to circumvent inaccuracies in forecast, and conclusions made on the foundation of forecasts (Sevilla, 2007).
Company Overview
Costco Wholesale Corporation is known as the largest wholesale club operating in the United States according to the organization’s Co-founder and Director Jim Sinegal (Costco, 2012). The company carries quality name brand products at considerably lower prices normally found at conservative wholesale or retail stores. The merchandise sold varies from food, clothing, appliances, electronics, furniture, sporting goods, etc. (Costco, 2012). The depots are set-up to assist small-to-medium size organizations with reduce prices to acquire for daily business use and resale. People can also buy for their individual needs. The Costco Wholesale Corporation uses the Real-Time inventory system that permits major suppliers to have admission to their inventory data. The process is the cashier scans the merchandise at the register the system will automatically update, and electronically inform inventory supervision at Costco the stock amount is near reorder status (Costco, 2012). The concern is the business occasionally has inaccurate records of merchandise brought in and shipped out. This problem occurs when employees input information in the system incorrectly. This type of inventory error can cause the business to order additional products or set-up orders to ship out more merchandise than what is in stock.
Solution to the Problem
Costco Wholesale Corporation recognizes that the perpetual inventory system Real-Time is an asset to their organization. However, employees must have a complete understanding of the technology in use. The Real-Time inventory system is technology that offers bar coding, perpetual inventory software to record and track the cost levels of stock at every stage of production. The system provides specific data regarding the location of products, work-in process, raw materials, and the price of merchandise sold. The system offers financial report set- up, inventory control, and cost management. The technology offers effective inventory buying and ordering to decrease the possibility of supply dilemmas. Therefore, the solution is to schedule and provide each employee with adequate training to ensure staff comprehends the dynamics of the technology in use by Costco Whole Corporations and his or her responsibilities as an employee. This will benefit the organization to avoid errors in inventory, engage employees in the complete inventory process, build confident in staff, enhance productivity, enhance customer satisfaction, and afford the company financial profitability (Sevilla, 2012).
Converting Data into Information
There is a lot of data in the world. Costco Wholesale Corporation alone must
