1. Stock Handling /Inventory Control
Chapter 24

2. 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

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

4. 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

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

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

7. 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

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

9. 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

10. 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

11. 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

12. 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

13. 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

14. 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

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

16. 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

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

18. 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

19. 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

20. 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

21. 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

22. 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

23. 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

24. 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

25. 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

26. Assignment
Reviewing Key Terms
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