Question

Galfar Engineering & Contracting SAOG ( Galfar ) is the Oman ' s largest construction company . The company believes that a proper inventory control system ( techniques ) helps the enterprise in solving the problems of liquidity , eliminating excessive stocks , and achieving increased profits , with substantial reduction in working capital , Critically evaluate the possible different inventory control systems adopted in the company in the light of above information .

Answer 1

There are basically three kinds of inventory systems:

Manual : An employee essentially goes through the inventory, counts all items, writes down results, and enters the quantities in a spreadsheet. This information can then be used to re-order materials as needed.

Periodic : Periodic inventory systems have become the bridge between manual systems and perpetual systems. Inventory can be tracked manually and periodically; however, barcoding systems have improved periodic inventory systems.
Facilities can easily implement a barcode system by tagging inventory items. These barcodes are periodically scanned to track the item from its arrival to the facility, throughout its travel or usage within the facility, and its final destination when it is either used in a finished product or consumed.

Perpetual. The most sophisticated inventory system delivers real-time data. As soon as inventory enters a facility, is moved, sold, used, or thrown out, the central system is immediately updated.
Radio frequency identification (RFID) tags play a large role in perpetual inventory systems. Active RFID tags can constantly send data and provide real-time information while passive RFID tags use electromagnetic energy from a reader to transmit data. Data from RFID tags can be sent to a CMMS system, giving management transparency into inventory levels that can help them make smarter business decisions.