Stock Handling /Inventory Control Chapter 24

The Stock Handling Process 24.1 After finishing this section, you will know: The need for a stock handling process How merchandise is received and checked The methods and procedures used to mark merchandise The procedures used for transferring merchandise

Stock Handling The stock handling process includes: Receiving goods Checking the goods Marking the goods with information Delivering them to their selling location

Receiving Merchandise In a small business, one person performs all of the above functions In a large business, different people perform each job Separate warehouses are used to receive and store goods until they are ready for sale

Receiving Merchandise Dock- specific areas where deliveries are made by carriers Covered and enclosed platforms are used to protect merchandise from weather damage

Receiving Orders Receiving record form used to describe the goods received by a business

Receiving Orders Receiving records can include the following: Person who received the shipment Shipper of the merchandise Place from which the goods were shipped Name of the carrier Weight of items delivered

Receiving Orders Shipping charges Department or store that ordered the merchandise Date the shipment was received

Receiving Orders Apron- form attached to the invoice before the merchandise moves through checking and marking Helps prevent the payment of duplicate invoices because the apron is made out only when the shipment is received

Checking Merchandise Checking- the process of going through the goods upon receipt to make sure they arrived undamaged and that the merchandise ordered was received

Checking Merchandise Blind check method- requires the receiver to write the description of the merchandise, count the quantity received, and list them on a blank form (dummy invoice) Dummy invoice is then compared to the invoice after the blind check is made Most accurate checking method Time consuming

Checking Merchandise Direct check method- merchandise is checked directly against the actual invoice or purchase order Faster than blind check method Errors may be found if the invoice is incorrect

Checking Merchandise spot check method- random check of one carton in a shipment Carton is checked for quantity and then one product in the carton is inspected for quality If the checked carton is correct, the remaining cartons are assumed to be correct Often used for canned goods, paper products, and pharmaceuticals

Checking Merchandise Quality check method- done to inspect the workmanship and general characteristics of the merchandise Although the receiver can do a quality check, the buyer often does this If goods are damaged, a damage report is prepared Damaged goods should not be discarded without the authorization of the shipper

Returning Merchandise Careful checking of products can save large amounts of money Businesses can get proper credit or adjustments from the shipper

Returning Merchandise There are other reasons products can be returned other than for damage: Receive something they did not order Decided to cancel the order after it was shipped Orders get mixed up and are delivered to the wrong recipient Credit memorandum- notification that the buyer’s account has been credited for the value of returned merchandise

Marking Merchandise After the merchandise is received, it must be marked with the selling price and other information

Marking Merchandise Universal Product Codes (UPCs)- made up of parallel vertical bars and a row of numbers printed on a package or label Describe the merchandise and price information Scanned into a computer for use in tracking sales and inventory levels

Marking Merchandise Source marking- seller or manufacturer marks the price before delivering the merchandise to the retailer Merchandise can be moved directly from the receiving area to the sales floor UPCs are scanned at checkout, and the price stored in the computer is entered for sale

Marking Merchandise Preretail marking method- pricing is marked in advance on the purchase order Information entered in the buyer’s computer system Prices available for marking merchandise as soon as it is received

Marking Merchandise Items can be ticketed three ways depending on the merchandise: Gum labels- flat, hard surfaces such as books Pin tickets- things that won’t be damaged by pins including socks or scarves String or plastic tags- larger articles such as dresses, shirts, or suits

Price Ticket Information Many things can be included on the price ticket (other than price) that is placed on an item: Store number Model/style numbers Color Size Fabric

Price Ticket Information This information is included so that: Businesses can determine which items, sizes, and colors are popular with customers The shopping process is simplified for customers

Transferring Methods Stock is transferred from store to warehouse at the beginning of each season Old merchandise must be removed to make room for new merchandise Transferred merchandise is accompanied by a form describing items, style number, cost, and retail prices

Transferring Methods Stock transfers can occur when: Merchandise is carried by more than one department Merchandise is used for sales promotional displays One store needs to fill requests by customers If one location doesn’t have your size, the store can order the item from a different location

Assignment Reviewing Key Terms Page 433 #1-6