Merchandise and Inventory- Inventory Management

What is the key tool for inventory control?

Purchase order (P.O.)

What is a disadvantage of high turnover?

can lead to desired inventory being out of stock, missed sales, and staff members spending too much time buying, ordering and receiving merchandise

What are the two methods of tracking real-time inventory changes during the time between physical inventory counts?

dollar and units- tracking by dollar amount helps keep the facility's inventory investment in balance with sales, while unit control systems help determine the performance of individual items or styles.

What inventory management tool serves to ensure adherence to the business plan?

enforcing a clear and efficient P.O. system is necessary to ensure accuracy and adherence to business plans

A physical inventory counts all goods for sale, including the value of refillable goods (like range balls), minus employee sales. (t/f)

false

Adopting a perpetual book inventory system replaces the need to conduct physical inventory counts. (t/f)

false- always need a physical count

Annual physical inventory counts are the most effective way to identify inventory problems. (t/f)

false...monthly physical inventory counts need to be made

Why is high turnover beneficial?

increased sales; fewer markdowns; ability to capitalize on new trends; lower expenses; higher employee morale; higher return on investment

What does "complete date" indicate on a purchase order?

last possible date that the vendor can have the order delivered to and accepted by the purchaser

How often should a physical inventory count be conducted?

monthly/quarterly

What could cause shrinkage?

occurs for various reasons such as internal or external theft, human error, damage, loss, inadequate receiving or sales procedures, and insufficient accounting and tracking practices

Which term represents the method of tracking real-time inventory changes between routine inventory counts?

perpetual book inventory using POS

Why is it important to conduct physical inventory counts?

to double check items on hand

What is the benefit of receiving and checking inventory?

to ensure that common issues do not occur: missing merchandise; incorrect pricing; over-shipped merchandise

What is the purpose of taking physical inventory?

to identify problems and enable golf professionals to respond in a timely manner...help validate current inventory records and identify variances from the amount of inventory expected to be on hand

A point of sale system allows merchandisers to track the age of merchandise in stock. (t/f)

true

Perpetual book inventory can determine both merchandise on hand and merchandise sold. (t/f)

true

Physical unit tracking can determine both merchandise on hand and merchandise sold. (t/f)

true

The purchase order can serve as a reminder to subtract the appropriate amount from your OTB budget for a particular classification. (t/f)

true

A high turnover rate can result in lower insurance costs. (t/f)

true- higher inventory turnover means there is less product in the shop at any given time...leads to lower expenses for insurance, storage, and shrinkage

Operational efficiencies increase when management has the flexibility to use discretion when following backroom policies and procedures. (t/f)

False

A point of sale system (POS) is the key inventory control tool for identifying merchandise on order. (t/f)

False- Purchase order (P.O.) is the key inventory control resource that helps identify what merchandise on order