Disadvantages Of Inventory Management

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Inventory control is defined by the Merriam Webster Dictionary (2016) as the organisation and regulation of the supply, storage, distribution, and recording of materials to maintain adequate quantities for the current needs of the business without excessive over supply or losses. This research paper focuses on the control of beverage inventory in the lodges at Singita Sabi Sand. At current, both Singita Ebony and Boulders Lodges use a periodic inventory system to record and manage beverage stock. This means that stock data is recorded manually into a system and a physical count of stock is done on a monthly basis. Hamid (2015) describes inventory as the physical stock maintained on hand by a business to ensure its operations function efficiently. As an asset, inventory is extremely important to any business as its turnover represents revenue generation and income. However, the hospitality industry may differ in this sense as inventory is often a record of tangible goods, such as beverages, which accompany the intangible attributes of the service on offer for purchase. In the case of…show more content…
Both the periodic and perpetual systems have advantages and disadvantages which must be evaluated whilst keeping in mind the specifications of the business. The periodic inventory system involves a physical inventory count at specified periods of time throughout the business year (Blystone, 2015). This count is carried out to measure the level of stock on hand, in most businesses this is usually done once a month. This method of recording inventories relies solely on human labour through the manual inputting of sales or stock distribution into a system to determine the calculated stock on hand. Followed by the physical count of the actual products on hand to verify any

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