What is the Difference Between Inventory Control and Inventory Management?
🆚 Go to Comparative Table 🆚Inventory control and inventory management are similar but have different focuses. The main differences between them are as follows:
- Focus: Inventory control is responsible for the movement of inventory within the warehouse, tracking the goods or materials on-hand, their quantities, condition, and status. Inventory management, on the other hand, encompasses the entire process of forecasting demand, ordering, and managing stock on hand, looking to the future to see what customers will want to purchase and placing orders accordingly.
- Purpose: Inventory control aims to recognize how many goods are being stocked and ensure that they are kept in the right conditions, preventing overstocking or stockouts. Inventory management focuses on managing product demand and maintaining good customer satisfaction levels by ensuring the right quantity of the right product is available at the right time.
- Functions: Inventory control involves tasks such as receiving inventory, processing stock takes, and processing inter-branch transfers. Inventory management tools provide features like demand planning and forecasting, calculating safety stock, calculating re-order points, identifying fill rate percentages, calculating replenishment stock, identifying obsolete items, streamlining the ordering process, and optimizing warehouse layout.
In summary, inventory control is a part of the overall inventory management process, tracking daily trends and the movement of inventory within the warehouse. Inventory management is a broader concept that looks at longer-term trends and involves forecasting demand, ordering, and managing stock on hand. Both practices track and manage stock, and ideally, inventory systems should communicate with each other for better efficiency.
Comparative Table: Inventory Control vs Inventory Management
Inventory control and inventory management are related but distinct processes that work together to help businesses manage their stock. Here is a table highlighting the differences between the two:
| Feature | Inventory Control | Inventory Management |
|---|---|---|
| Focus | Regulating stock levels and movement within a company's warehouse | Forecasting, ordering, storing, and selling a company's stock |
| Purpose | Ensuring the optimal amount of each stock, raw material, and finished goods is present in the store or warehouse | Managing the entire process of handling inventory, including forecasting and reordering goods |
| Scope | Day-to-day process performed in a company's warehouse | Broader process that includes various components like raw material, finished goods, and warehoused items |
| Methods | FIFO (First in, First out), LIFO (Last in, First out), FEFO (First expiring, First out) | Covers business processes related to inventory, including its forecasting and planning |
Both inventory control and inventory management systems are essential for effective stock management. Inventory control systems regulate inventory levels and movement, ensuring that the right amount of stock is available in the warehouse. On the other hand, inventory management systems handle the broader process of forecasting, ordering, storing, and selling a company's stock. These systems often work hand in hand, with some software solutions offering features for both inventory management and control.
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