INVENTORY RELATED DEPARTMENT
The department must maintain a minimum quantity known as a safety level of stock. Once the stock goes down below that level, it must he replenished. In recording the lead lime must be considered. Lead time refers to the time taken by the supplier for processing and shipping the order. Moreover, internal control system should be established to ensure the safety of the inventory.
Inventory Record Department
The department must keep inventory records complete. Any incoming or outgoing item should be recorded immediately, and not postponed to a later time.
A separate department should be set, up to deal with receiving and handling merchandise. In addition, it should be responsible for purchasing, acquiring, stocking, requisition issuing, and shipping. Generally, such a department is called as a purchase department which enjoys exclusive authority to make all purchases.
In addition to a purchasing department, there should be a separate receiving department that should receive all the incoming merchandise.
Its function will be receiving, counting, detecting any detective items, tallying the shipment with the order, reporting to the accounts payable section, and sending the shipment to the stores department. The organization may be as follows: