Organisations such as manufacturers, distributors, wholesalers, and retailers have inventory levels that they intend to sell. The inventory levels of these types of organisations tend to cluster in warehouses. A retailer's inventory may be kept in a warehouse or in store where it is accessible to the customers. Hence, while accumulating stock level, cash may be tied up and if not controlled accordingly then it will be difficult to know the actual stock level.
The inventory system caters for this essential need and shows the exact stock level needed for an organisation. The system assists in demand fluctuations of the stock, that is, encounters to reduce the possibility of falling below stock level or having too much stock on hand. Controlling stock level provides clarity in decision making by management to reduce the risk of allocating access fund on stock.