Posted by admin | Posted in archery | Posted on 18-05-2010
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A Peep into Stock Management and Order Fulfillment
Stock management is the understanding, of the different demands, of the stock mix of a company. It is the equation between demand and supply. Demand is influenced by a number of factors both within and without the market. It is balanced by orders of purchase to keep the supplies at a desired level. It is the entire process of which order fulfillment is a part. It is the process that culminates with the delivery of orders.
Stock management usually occurs at two places namely the wholesale market and the retail market. The two markets are inter connected. As far as the wholesale market is concerned, orders are placed at the concerned head quarters, then on receiving, they are stored in the warehouses, from where it is then sent to the various stores. Therefore a closer view of the scenario shows that the process of stock management involves certain steps in a chronological manner. Having mentioned a few already, the latter steps include, the stores receiving the goods and finally its sale to the customers. This process not only includes the quantitative management of stocks but also the cost involved in the entire process right till the end.
Order fulfillment in the other hand involves steps that are mostly similar, the orders are placed after an initial inquiry, about the product and the availability of price quotes, budget. The order is then confirmed officially and a bill sent to the customer in concern. This is followed by the location of shipment being decided between the concerned parties. In case there is a requirement of changes in the order placed,it is generally done in at this stage. After this the goods are packed for being shipped. This step is followed by the shipment and delivery of goods to the party concerned. It is then followed by the monetary settlements between the two parties. The final step in the process of order fulfillment is that of return of goods that are either not required or are damaged in the process of delivery. Goods found unacceptable by the customer in concern can also be sent back.
The models employed by most companies in order to increase stock management control are principally of three types, namely vendor managed inventory, customer managed inventory and just-in-time inventory. These methods are adopted to ease up the process and mutually benefit both the parties concerned.
Order fulfillment, apart from performing its conventional part in the entire demand-supply chain, also helps in determining the point where the forecast-driven supply and the demand-driven supply meet. Owing to the fact that forecast-driven supply may lead to losses, with the passage of time it has become increasingly important to reduce the part played by forecast-driven supply chain elements, and concentrate on the maximization of demand-driven supply chain elements. This process also strategizes how firms customize their products and deal with product variety, thereby playing a very important role. The impact of product variety can also be mitigated by strategies like build to order, late configuration, modularity and option bundling.
Hence from an overall view point, both stock management and order fulfillment are basically not independent, rather complimentary processes in the wider circle of demand-supply chain that drives the market economy.
About the Author
Richard Smith who is a professional author writes articles on stock management and order fulfillment. For more information he suggest to visit http://www.tfstore.co.uk/ .
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