Guide to inventory management and stock control
Effective stock management can be the difference between healthy profit and a struggling business. This article covers everything you need to know about stock management, stock control and different types of inventory.

What is inventory management?
Inventory, or stock management is a process that ensures you have the right amount of stock, in the right place, at the right time. It involves understanding your customers’ buying patterns and meeting demand, without over- or under-stocking. Let’s say you run a supermarket chain without an efficient stock management process. You might find that you have more chicken in stock than you can sell. Or not enough rice. This could persuade your customers to go to your competitors instead. Inventory management is also about planning for fluctuations in demand. For example, ensuring you have extra food available in the run-up to the holidays.What is inventory control?
Inventory control involves knowing where your goods are at any time. It helps you make the best decisions about how you organise and distribute stock. Efficient stock control means you can find any product, whenever you need it. Take our supermarket example again. A good stock control process makes it easier for the store to respond to changes in demand, like selling out of soft drinks during one hot morning. With good grasp of stock control, the store would have sent a driver to get more stock from the warehouse, before the existing stock ran out.Types of inventory
Different industries have different inventory types. Inventory management is often thought of in relation to retail and manufacturing. But there are various types of inventory that relate to logistics, catering, and even some service organisations. Here are the main inventory types that your business may need to manage:- Merchandise
- Raw material
- Work in process
- Transit inventory
- Maintenance, repair, and operations goods
What is the best inventory valuation model for your business?
Inventory valuation helps you work out the monetary value of the stock you hold. It is also essential for accounting purposes. There are two main types of inventory valuation models: periodic and perpetual valuation.- Periodic valuation
- Perpetual valuation