Reference no: EM133145699
Question - Entrepreneurship is in Alyssa Stuart's blood. Alyssa has been starting businesses since she was 10 years old, and she finally has the perfect business of custom-made furniture. Customers who visit Alyssa's shop can choose from a number of different fabrics and 50 different styles of couch and chair designs to create their custom-made furniture. Once the customer decides on a fabric pattern and furniture design, the information is sent to China where the furniture is built and shipped to the customer via the West Coast. Alyssa is excited about her business; all of her hard work has finally paid off as she has more than 17,000 customers and 875 orders currently in the pipe. Alyssa's business is booming. Her high-quality products and outstanding customer service have created an excellent reputation for her business.
In order to expand the business, Alyssa Stuart has hired you as an external financial consultant. You are expected to provide her with advice on financial management issues, business strategy and future development.
You have found out that Alyssa's business does not use a formal, consistent inventory tracking system. The information on inventory is recorded in Microsoft Excel spreadsheets. Periodically, an employee in China visually checks to see what items are in stock. Although Alyssa's company tries to keep a certain level of each "top seller" fabric and details in stock, the lack of a formal inventory tracking system has led to overstocking of some items and understocking of other items. As a result, if a certain fabric is not available, Alyssa Stuart risks losing a customer to a competitor. You are concerned with Alyssa's inventory management methods and suggest introducing some changes.
Required -
1) Explain what Inventory Management is and why it is important.
2) How can a poor Inventory Management System affect Alyssa's business? Provide three examples of problems that may happen.
3) Search on the internet and find Inventory Management software that you would suggest Alyssa to implement. At least three reasons why you have chosen that option.
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