Stock Levels in Storage Class 9 Notes

Maintaining the right stock levels is crucial for the success of any retail business. This Class 9 topic covers the concepts of minimum level, maximum level, reorder level, and safety stock. Understanding stock levels helps in avoiding overstocking or stockouts, ensuring smooth customer service and efficient inventory control.

Stock Levels in Storage Class 9 Notes

Session 1: Stock Levels in Retail Stores

Meaning of stack level

Everything which is used to make products, provide services and to run business is part of stock. Stock level is the different levels of stock required for effective control of materials at a retail store, to avoid over- and under-stocking of materials.

Stock levels in retail store

The store operations assistant should constantly observe the stock levels of various goods in the retail store to avoid the repercussions of over or under-stocking which are dangerous for the retail organisation.

Types of stock levels

There are mainly four types of stock levels.

• Minimum stock level: If the stock in retail store is less than the minimum level then the retailer should immediately order the goods. When the stock goes below the minimum level then it is called under-stocking.
• Maximum stock level: Beyond the maximum level of stock, the retailer should not order more goods, as it may increase the carrying cost. When the stock crosses the maximum stock level it is called over stocking.
• Re-order level: When the quantity of goods reach a certain level then a fresh order is sent to procure new products.
• Danger level: If the stock touches danger levels, then immediate action should be taken to maintain the stocks even if additional cost is incurred in arranging the required goods.

How to check stock levels?

Any business that holds a storck of items for sale can keeps an accurate record of all the item in hand. Stock levels also called inventory cab be checked by using a variety of method:

• Stock ledger: Stock ledger keeps the information of the stock and amount of stock or inventory.
• Bin card: It is used to keep a track of the number of items.
• Computerised: Computerised stock-checking systems are used by businesses which wish to have a continually updated list of available stock.

Need for managing stock level in retail

• Efficient Inventory Management: Track the current stock, ordered items and sold products and ensure record-keeping for better decision-making.
• Continuous Product Availability: Maintain the supply of goods to meet customer demand.
• Customer Retention: Ensures customers find what they need when they visit.
• Loyalty Development: The service helps convert customers into loyal patrons.
• Order Level Monitoring: Tracks reorder points to alert managers before stock runs out.
• Avoids Over-Stocking & Under-Stocking: It avoids over-stocking and under-stocking positions of goods in retail stores.

Session 2: Documents Required for Stock Handling

Normally stock arrives in the retail store in the truck or container. The retail store manager must know about the stock’s characteristics. A retailer should ensure that:

• The stock is sorted as per the retail store’s requirements.
• The stock is recorded as per the retail store’s procedures.
• The stock is then checked as per the required documentation.
• The difference between actual stock received and invoiced/ordered stock is identified and reported according to the retail store procedures.
• The relevant documentation is completed as per the retail store procedures.
• The retail organisation systems for receiving and maintaining stock levels must be appropriate.
• Goods should be available when required.
• Goods must be fit for use/ready to use.
• The method employed is cost-effective, and wastage is minimal.

The following documents are usually prepared while stock handling.

• Delivery note: Goods delivered are checked against the delivery note to confirm the delivery is correct.
• Invoice: The invoice contains all the information about the goods, like the quantity and nature of the goods.
• Consignment note: The consignment note is used when the delivery is out to a private carrier. It shows what goods are and are issued by the carrier for delivery.
• Internal packing note: It gives the details of outer containers, such as bags, cartons, drums, boxes and pallets.
• Electronic data systems: Many retailers use a special computer for receiving consignments or goods; it is called an automated system.

The features of an automated system are

• The consignment note is a proof of delivery sent through a computer.
• The consignment note contains barcodes.
• barcoded delivery labels

Procedure for checking stock levels

In the process of checking stock levels of different products in a retail store, if any variations or problems are identified, the store operations assistant must report to the competent authority. The various remedies which are available to rectify the deviation in the supplies are as follows:

• Replacement
• Credit
• Disposal
• Selling off as seconds
• Repair and charging to supplier
• Return to supplier

Reporting deviations

When a delivery is incorrect or damaged, a damage or shortage report must be completed. This includes:

• The date on which damaged goods were received.
• The shortage that occurred during delivery.
• Whether the goods failed to arrive at the stipulated time.

Session 3: Reporting Storage Space

Concepts of floor plan

Maintaining the floor plan is the most important duty of a store operation assistant. The floor plan indicates the place where the goods or products and customer services are together.

Appocating space

Allocating space means give a specific place for keeping a specific type of merchandise for incrasing the sales by satisfying the customer purchase experience.

Types of spaces needed

There are five main types of floor needs in a store, which are as follows:

• Back room: Back room is the space where the extra merchandising is stored.
• Office and functional spaces: Every retail store has space for an office, a break room, a training room, and an office for the manager and assistant manager and bathroom facilities for customers and employees and perhaps other area.
• Aisles, services areas and other non-selling areas of main sales floor: Some space must be given up for non-selling functions so that a large numbers of shoppers can move through the store.
• Wall merchandising space: Fixtures holding large amounts of goods or merchandise, as well as visual backdrop for merchandise on floor can be put up on walls.
• Floor merchandising space: Different types of fixtures can be used to display a variety of goods.

How can retailers use the available space?

The retailer’s goal is to make the largest possible portion of the space available to hold goods and be shop-able. Following are some tips for using available space:

• One possibility for saving space, especially in a small retail store, is to hang the TV on the wall.
• The height of a showcase may vary according to the storage needs and location in which it will be placed.

Reporting requirements for shortage of storage space

Shortage of storage space is a repeated issue in retail. When the total value of the stock found during physical stocktaking is less than the book value, then there is a stock shortage. The shortage is of two types. Real (physical shortage) or apparent (clerical shortage).

• Real shortage: It occurs when goods are lost, broken or spoilt, over-issued or under-supplied.
• Clerical shortage: It occurs due to errors in documentation or checking during goods reception. Unexpected physical shortages are popularly known as shrinkage or leakage.

Session 4: Handling Equipment

To sort and manage goods effectively based on customer requirements, it ensures that the right products are available, accessible and in good condition. The three basic handling activities in a retail store are:

• Receiving
• In-storage handling
• Shipping.

Meaning of handling equipment

There are various types of equipment used in a retail store for loading and unloading, storing and selling of goods. Equipment is used to handle goods safely.

Types of handling equipment

• Trolley
• Bags
• Basket
• Handheld scanner: It can read the barcode of goods and help in making the bills.
• Labelling machine: To make clear, neat labels that they can stick on the product.
• Electronic Funds Transferred at Point of Sale (EFTPOS) printer: It helps in printing the transaction receipts.
• Electronic scales: Electronic scales are used for weighing goods in a retail store, especially in the food department.
• Pallet: Retail stores have multiple options for shipping the product from the store.
• Crane: A crane is a machine used for lifting goods. It moves goods horizontally.
• Forklift: It is material handling equipment also called a lift truck, fork truck or forklift truck.

Need equipment while handling goods?

Handling equipment plays an important role in handling goods in a retail store. Handling equipment is useful in many ways, such as:

1. It helps in identifying appropriate distance to cover.
2. It facilitates reducing material damage so as to improve quality.
3. It reduces the overall timing of loading and unloading.
4. It helps in improving control of material flow in a retail store.
5. It helps in improving safe work conditions.
6. It improves the productivity and efficiency of employees in a retail store.
7. Customers can better utilise their time and money.

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