Supply management involves checking inventory.
Supply management is a term used to describe the processes used by many companies to procure, inventory, and distribute items that are used in the ongoing operations of the business. The supply management process deals with raw materials used in production, as well as office supplies, machine repair components, and anything else that is used internally for the ongoing operation of the business. One of the main goals of effective supply chain management is to balance the need to have items available when they are needed with keeping less inventory, allowing the business to carry less overhead.
Supply managers are responsible for purchasing new office equipment.
For many companies, the supply management process begins with a central purchasing department or group. This group actively coordinates the purchase of raw materials, parts and supplies, and even items such as copy paper, pencils and printer cartridges. A purchasing group will seek out profitable suppliers and build relationships that allow the company to purchase items as needed or on a predetermined schedule that can be changed if needed. The group then coordinates the delivery of the items so that they arrive at the factory facility just before they are needed.
Automated systems can enable managers in large companies to quickly and accurately inventory resources and supplies.
For many people involved in supply management, a traditional concept that governs the overall process is simply known as usage. Usage refers to the number of units of a given item that are routinely used in a given period of time, such as a month. Determining average usage is helpful to the supply manager as it allows them to project when current inventory will run out and need to order more units for delivery just before they are needed.
A supply manager in a small organization can find suppliers and authorize purchase orders, as well as guarantee delivery.
By coordinating purchase with use, the supply management process accomplishes two things. First, the process allows you to design and maintain a viable budget, ensuring that the materials and other items necessary to keep the business running are always present. Second, effective supply management also facilitates the practice of responsible inventory control, keeping the number of available units of any item within a certain level and thus minimizing the tax burden that companies pay on raw materials, products in process and finished products.
Delivery of copy paper and ink cartridges to offices is a typical component of supply management.
In the past, the supply management process relied heavily on a manual record-keeping process that tracked the ordering, receipt, and disbursement of each item purchased for business use. As part of these manual records, it was critical to calculate usage based on issue dates for different departments in the company. Today’s supply management software handles many of the calculations automatically as receipts and disbursements are entered into the database. This allows supply managers to quickly run reports indicating which items need to be reordered next week and how many of each item need to be reordered.
Effective supply chain management seeks to balance the need to maintain an adequate level of inventory with keeping overhead costs low.
Some of the more robust supply management software programs are even capable of creating electronic and paper internal order approval forms, such as requisitions that are sent to a central purchasing department and assigned an invoice number to be processed. reference in the actual order. Software of this type can often create order fulfillment forms and distribute copies to authorized departments once the materials are received at the point of use.