In advanced manufacturing landscapes, it is injustice with your business by not automating your inventory. To receive a better return on Investments, one needs to spend on Managing and controlling Inventory first. Though both terminologies seem very identical in Inventory Management and Inventory Control, they are very different procedures in a manufacturing unit.
Inventory Management vs Inventory Control
The difference between an Inventory Management and Inventory Control is that Inventory Management deals with forecasting and ordering stock for manufacturing goods and Inventory control refers to dealing and monitoring stock-in-hand. Inventory Control is a sub-set of Inventory Management and also called stock control. Inventory control is primary whereas Inventory Management is secondary.
The term Inventory Management refers to the process of storing, ordering, utilizing, and selling a company’s stock. This process includes the management of various components like raw material, finished goods, warehoused items, and Work-in-Progress. Active forecasting and re-ordering of raw material are the recurring tasks under Inventory Management.
The term Inventory Control refers to the method of regulating the stock level in the company. It helps to avoid the risk of stock-out in an organization. It also ensures the quality of stock is saleable or not. Inventory control is a day-to-day process performed in a company’s warehouse to protect product wastage.
Comparison Table Between Inventory Management and Inventory Control
|Parameters of Comparison||Inventory Management||Inventory Control|
|Meaning||Inventory Management is a process of forecasting and re-ordering goods in a company.||Inventory Control is a method of regulating the stock level in a company’s warehouse.|
|Purpose||The purpose of Inventory management is to maintain a balance between demand and supply.||Inventory control helps to avoid the risk of wastage and theft of goods.|
|Scope||Inventory Management has a wide scope of activity.||As compared to Inventory Management it has a small scope as it is a part of Inventory Management.|
|Focus||The Focus of Inventory Management is When to order? How much to order?, and From whom to Order.||Inventory Control is focused on the prevention of stock from damage and spoilage.|
|Monitoring||Inventory management is an activity performed weekly or monthly as per the size of the business.||Inventory control is performed on daily basis.|
What is Inventory Management?
The term Inventory Management refers to the entire process of monitoring inventories from the buying of raw materials to the selling of finished goods. It helps to avoid the glutes and shortage by streamlining the ordering activity. The 2 prominent ways to manage inventory are JIT (Just In Time) and MRP (Material Requirement Planning).
The shortage or mismanagement of inventory is detrimental to the reputation of an organization. An effective Inventory management software works wonders in the growth and development of a manufacturing unit. It is supported by the ERP management software in big companies. Helps the company to recognize How much quantity to order at what time?
Inventory Management keeps a track record of goods from purchasing raw material to selling final items. It plays a very significant role in a company’s management by balancing the stocks. There are mainly two major benefits of Inventory Management i.e. Saves money and Improves cash flows.
It is a critical term that denotes Right stock, Right time, Right place, and for the Right purpose at the correct price. By controlling and overseeing purchases, Inventory management helps in the smooth flow of the supply chain.
What is Inventory Control?
The term Inventory Control refers to the process of analyzing the appropriate amount of Inventory are maintained by a company to ensure minimum wastage of stocks. It mainly aimed to decrease the number of slow-selling goods in the company and increase the number of high-selling goods in the company. It saves time and money by avoiding damage, theft, etc.
The extraordinary expenses can be avoided by using an Inventory control system in the company. It saves the company from taking a rash decision that results in losses. Complex Inventory control cannot be handled through Pen and Paper system, It requires separate software or excels sheets. There are ample software services in the market for overall inventory control. Inventory should be in well-managed condition is checked through the process of Inventory control.
The optimal amount of each stock, raw material, and finished goods is present in the store or warehouse is derived with the help of an Inventory control system. It monitors the usage and movement of Inventory. The ultimate goal of this process is to track out maximum gains with optimal stocks in the company. Since it manages the already available inventory in the company therefore it has no relation with sale or purchase.
Main Differences Between Inventory Management and Inventory Control
- Benefits: Inventory Management helps to streamline the ordering process in a company and Inventory control helps to track the daily record of stocks in a warehouse.
- Ideal Usage: Inventory Management works better with the help of ERP software on the contrary Inventory control can be performed manually.
- Responsibility: Inventory Management is the task performed by the Inventory Manager whereas Inventory Control is performed by usually storekeeper or warehouse keeper.
- Mode of Operation: Inventory Management gathers near- and real-time inventory data using barcode or RFID to locate stockouts and overstocks. and Inventory Control uses barcodes or RFID to track and record inventory dealings.
- Output: Improvement of warehouse layout and storage of stock is the result of Inventory Management and Inventory control sends alerts about low stock levels or expiration dates.
Effective monitoring of inventory is a vital point of Inventory management. Optimizing cash flow and reducing overspent is possible via Inventory control. Whether a business is small or big both Inventory control and management have their importance in a business to earn maximum gains.
They both perform their functions hand in hand. Effective results of Inventory control and Inventory management are obtained with the latest technology software that saves your hard-earned money. Right time selling and Right time purchasing this what every business requires. Inventory management drives its data from Inventory control to check out past trends. To have better management, one needs to have better control over inventory.