We have selected Big bazaar

Question 1 Describe in detail about the business process chosen. Also draw the process flow diagram.

Information consists of data that has been organized to help answer questions and to solve problems.
An information system is the software that helps organize and analyze data. The purpose of
an information system is to turn raw data into useful information that can be used for decision making in
an organization.

ROLE OF INFORMATION TECHNOLOGY IN BIG BAZAR:

With the retail sector in India undergoing a transformation due to the entry of large corporate houses, IT
managers and CIOs are now looking forward to know how IT can help them achieve the business goals of
their organizations.

 Standards-based architecture and software support all kinds of mission-critical IT applications for enabling
greater efficiency, significant cost savings, and new business value. The critical activities that can be
handled by IT are finance and accounting, business intelligence, vendor development and management,
supply chain management, merchandising and inventory management, facilities management, stores
management, customer relationship management, branding, marketing, sales promotion and HR.

 Like any other retail stores Big Bazar also stands to benefit from elaborate IT set-ups. However, this is
subject to the scale and size of the organization, as well as an objective assessment of its requirements.
Key common challenges that can be tackled through IT implementations include accurate merchandising,
improved planning, and increasing profitability, enhancing customer experience, strengthening store
operations, improved workforce management, and improving the supply chain. This is in fact one of the
key imperatives facing retailers in India, to have a robust and scalable supply chain that will facilitate rapid
growth.
 Since a basic objective is to make data available to users and customers, proper IT implementation and
superior IT infrastructure ensure that in spite of getting minimal details, the retailer captures the right
information, which flows to everyone from the back office staff to the head office managers. The entire
information flow must be seamless. A retail business works on a network environment because the stores
connect to one another as well as to supplier sites. This is because in the retail business quick response is
the key to success. Proper IT implementation also ensures that investment in retail reduces substantially.

 An information system is a system that takes resources as input and processes them into information
product as output. It is an organized combination of people, hardware, software, network and data
resources. Management information system helps manager by following ways:

 It helps to know about the daily transaction

 To easily calculate profit and loss

 To take decisions quick and accurate with the help of MIS

 To know the regularity of the employees

 They use a storing device to store all transaction per day

Big Bazar has their own inbuilt software called SPARSH and SANCHAYAN for human resource and finance
respectively. They are using Sanskrit names for software’s. SPARSH means ‘to touch’ and SANCHAYAN
means ‘cumulative’. Future knowledge services (FKS) provide back end for all software’s in Big Bazar. In Big
Bazar, Coimbatore they are not using the SANCHAYAN software because all financial processing are done in
the Head Office, Chennai. They will send all the financial related data to the head office once in a week.

SPARSH software is used for processing employee details. It has separate login id for both employees and
operators. Employees can edit their personal details like address, mail id, phone number, family details etc.
They can go through their feedback and also they can mention their feedback in respective sites. In case of
emergencies employees can apply for leave through this information system. Individuals get the details of
the achievements they had achieved in the organization. One of the main advantages of this software is
that the employees can generate pay in slips. Every year performance appraisal of employees is done on
the month of April. Attendance record is also created using this software. Each employee have to swipe
 their card once they entered into the organization. The swipe machine automatically sent the details to the
SPARSH software.

In Big Bazar they don’t have any separate information system for marketing. They are using MS Excel for marketing
information system.

Management information system

 It helps in finance

 To find the cost of product

 Marketing activities

 Provide discount

 Organization security

 Employee attendance

 Stock availability

 Counting customer footmark

The centralized servers are used by the MIS where one is the main server and other is a backup server which can
take over from the main server within 5 minutes,if there is any problem. Each of the servers has its own storage
sysem with monitoring hard disks ( 15 hard disks storing the same information simultaneously). The information is
backed up continuously on CDs every day. The entire system is backed by an excellent electrical wiring by JD
International(electrical maintenance department). The recording of transaction at each counter is done using REM.
The database used for the storage is called POSH database and this is an in-house production of Big Bazar. These
transaction counters can capture credit card details and customer information of big customers ( though all the
information relating to all the customer is not collected as of now). Receipts of transactions are cash or credit. The
number of transaction made per day varies from 3000-4000 on week days to about 5000-6000 on weekends. Any
transaction recorded at each terminal is stored directly onto the POSH database.
What we have seen about critical analysis of information system prevailing in the Big Bazar , which is one of the
main retail sector in Coimbatore. The applicability and effectiveness that ensured that big bazaar has excellent in a
place like Coimbatore and become pioneer in the industry. This has been largely due to a radical and perfectly
functioning information system. The effectiveness of information system is greatly brought up by the efficient
supply chain and delivery system that big bazaar has. With the help of this system study we came to know that how
information system is helpful to the retail sector. Use of information system in retail sector is resulting in an
exponential increase in the sales, customer relationships etc. Simultaneously customers are finding it easy and
convenient to shop these days. Looking at the early days when a customer has to wait for a long time to buy a
product, it is easy now as they can select their product from wide ranges available in the market. They can select a
product which will serve their needs the best. This is also helping in maintaining the selling prices which was
misused by the other retailers in early days. This way use of information system is resulting in a drastic change in
the retail sector. A fair and proper mode of shopping is taking place.

Big bazaar is using SAP ERP {Enterprise Resource planning} software to manage its business

SAP stands for Systems Applications and Products in Data Processing

SAP SE is a German multinational software corporation that makes enterprise software to manage business
operations and customer relations. The company is especially known for its ERP software. SAP is headquartered in
Walldorf, Baden-Württemberg, Germany with regional offices in 180 countries.

SAP software is ERP (Enterprise Resource Planning) software used for effective business operations. SAP
software is used for below operations: Supply Chain Management. Product lifecycle management.

We have Selected Inventory management Process

Inventory Management in Big Bazar

Inventory management is the practice of monitoring, controlling and coordination of the ordering, storage and use
of components that a company uses in the production of the goods it sells.

Inventory management is also the process of monitoring and controlling of quantities of finished goods for sale. A
firm’s inventory is one of its major assets and represents an investment that is wound up until the item sells.

Objective of inventory management

Objective of the inventory management is to maintain an optimum size of inventory for efficient and smooth
production and sales operations.

Its objective depends on 5 R’s: Effort should be made to place an order at the right time with right source to acquire
the right quantity at the right price and right quality.

Information System in Big Bazar

An IS is a system that takes different resources as input and processes them efficiently into an information product
as output. It is a coordinated and organized blend of people, hardware, software, network both intranets and
extranets and internet and data resources. In the present scenario, if the retailer is on highest rung of the
information system, then he would be able to coordinate and manage his business efficiently and easily.

For large retailers like Big Bazar, it becomes very necessary to centrally coordinate and manage all the shops. Retail
management IS exactly does this very simply and efficiently with help of different specialized hardware, software
and networks, database management systems and various useful modules.

The primary role of Retail IS is to facilitate basic retail functions like raw material procurement, storage and
warehousing, dispatch and efficient delivery, etc.

It should allow the manager to oversee sales of differentiated product mix and daily sales volume. An information
system can help to a very large extent in inventory management.

The objectives of the retail management information systems are as follows:

 An Information system should provide necessary and concise data to retail manager in regular
intervals.
 An IS must foresee needs and requirement of the retail manager.
 An IS should be flexible enough to encompass constant increasing and evolving needs of the
consumer market.

An information system should be able to captivate, store and organize all the necessary data on a regular and
continuous basis.

Inventory management system

 When the customer is ready to spend, then you have got to be ready with required goods at any
condition. This is what the inventory management system is all about.

 It is a system which tracks inventory levels, sales, orders and deliveries to keep a sufficient
supply of goods while minimizing the cost of.

 Companies generally use inventory management to avoid product shortage or overstock.

  Inventory Management System helps in managing all your sales, accounting, stock, and
customer data.

 Inventory management is becoming one of the most crucial elements in the organisation as
inventory constitutes the one of the biggest part of Investment of any organisation in its current
assets. So funds blocked in inventory should neither be too high nor too low. It should just be
optimum. So one of the biggest aims of this inventory management system is to maintain the
optimum level of investment in inventory and stocks.

 As we know too high investment of funds in inventory results into the high blockage of funds in
the stocks which bears many kind of costs say the cost of interest on amount of money blocked,
cost of risk to bear, cost of storage in warehouses etc. So we can say that it reduces the overall
profitability of the firm which is one of the main aims of any organisation. On the other hand,
insufficient investment in inventory is also not desirable as it may lead to frequent stock outs
which is the biggest problem as it breakdown the production and selling processes.

 Therefore, the firm may lose their current market share as consumers once shifted can never be
regained. Inventory Management can be easily understand by the following diagram in which a
tap which is filling the tank can be considered as the supply of inventory and one tap which is
emptying the tank can be considered as selling of inventory. The flow of both the taps can be
considered as the frequency of inflow and outflow of the inventory. The capacity of tank can be
considered as the adequate amount of inventory which is required to maintain to avoid shortage
or surplus of inventory. We should maintain the inventory level to avoid any uncertainty in
demand or supply of inventory.

Types of Inventory Management System

  Periodic Inventory System:The periodic inventory system measures the level of inventory using an
occasional physical and the cost of goods that are sold. Commodity purchases are recorded in the
purchase account. The cost of goods sold and the inventory account are always updated at the end of a
specific period.
 Perpetual Inventory System:The perpetual system keeps continuous track of the inventory balances, by
making updates automatically whenever a product is sold or received. Returns and purchases are recorded
immediately in inventory account.

Importance of Inventory Management System

 Provides adequate inventory: The firm has to maintain sufficient inventory for smooth selling and
production activities so that surplus or shortage of inventory would not become the reason for the
downfall of the firm.
 Increase efficiency and effectiveness: If you want to enhance a profitable firm then it has to minimize the
investment in inventory so that we can use such limited resources in any other way which will enhance the
efficiency and effectivity.
 Increase productivity: The main objective of inventory management is to minimize the total cost of
carrying and ordering the inventory and the shortage costs. So as to enhance the productivity of the
organization they are maintaining the optimum balance between these costs.
 Avoid stock outs: As we know that no organisation wants the loss of their prospective customers due to the
lack of their supply when the customers demanded as customers once gone are very difficult to regain.

Inventory Costs Basically there are three types of costs involved in inventory handling. These are

1. SHORTAGE COST: It arises from the difference between the actual demand and the forecasted
demand. It is equal to the value of sales lost due to shortage of inventory.
2. ORDERING COST: It includes the cost of replenishing the stock from the sources.
3. CARRYING COST: It means the total cost of holding the inventory in their store. It includes the cost
of capital blocked in the stock. Inventory Costs Basically there are three types of costs involved in
inventory handling.

Types of inventories in Big Bazaar

The inventory management for all the branches is that they adopt different methodology for different categories of
products.

1) Cycle inventory is carried for the FMCG product category and Food Category as the turnover of these products is
high and after a period they get expired.

2) Safety level of inventory is adopted for Apparel as the cost of these products is high and they can be retained for
longer span.

3) Seasonal inventory is adopted for the products which are in demand for only peak season.
Big Bazaar generally deals in international level brands like Lee, Levis etc., and Wrangler along with this it also
deals with Private label brands KORIA in electronics, DJ&C in apparel, etc. The inventories can be further classified
into FMCG, fashion & apparels, FOOD & NON- FOOD junction, fruits &vegetables, chill section, home decorator,
book zone, footwear, etc.

Apparels: Formal & casual wears, fabrics, jeans & shirts, etc.

Home Care: soap, detergents, cleaning agents C

hill station: beverages products, drinks

Farm Products: fruits, vegetables, dairy products

Electronics: TV, Mobile, Accessories

Supply chain for perishable and imperishable goods Perishable products like fruits and vegetables are handled
with care and accuracy. They are purchased on regular basis as per demand. Care is also taken that damaged and
rotten vegetables are either rejected or sold at a lower cost to the local market. On the other hand for imperishable
products which are utensils, electronic items and staple goods are generally purchased from local manufacturing
units from different parts of countries. Big Bazaar is operated by Central Distribution Channel and by this
mechanism commodities are transported to every Big Bazaar Store. The modes of transportation are Truck & Rails,
but in emergency cases, flights are also used. The transportation is mostly outsourced which are primarily Quick &
Safe, Gati, Deluxe Roadways, and TNT.

Question 2 what are the main uses of computer-based systems in the particular organization for the business
process chosen? You can then work out if they are best described as TPS, MIS, DSS etc.

Management information system in Big bazaar MIS in Big Bazar

Management Information System (MIS) in Big Bazaar Big Bazaar has strong MIS capability that helps them to
improve their operations, as well as enhancing their speed of execution in response to what the customer want.
They are thus able to monitor their speed of response on daily basis across stores, departments and also for
category of products. This really helps them to take correct action on a timely basis and optimize their stock
accordingly. Big Bazaar uses JDA ERP and SAP ERP software. JDA ERP is an enterprise resource planning software
developed by an American software and consultancy company while SAP ERP is an enterprise resource planning
software developed by a German company SAP (System, Application and products) SE to manage the inventory
system of different business and improve customer relationship management.

What is ERP?

ERP is an acronym for Enterprise Resource Planning which is software used for business process management that
allows any organization to use an information system of integrated applications to do many back office functions
related to information technology and manages the business. Function of Enterprise Resource Planning in Big
Bazaar
Function of ERP in Big Bazar

Product Ordering

Merchandising Buying

Inventory Management

Stock Transfer

Process of MIS in Big Bazar

a) Start of day -SOD

Procedure
 Start the web portal
 Enter Login ID & Password
 Open webapp basics
 Click SOD status
 Click start SOD
b) End of day – EOD
 Start the web portal
 Enter Login ID & Password
 Open webapp basics
 Click EOD
 Enter LOGIN ID & Password
 Press Enter
There are 2 servers used by the MIS: Main Server and Backup Survey

Functioning of Management Information System (MIS) in Big Bazaar

Each of the servers has its own storage system (15 hard disks to store the same information)

The information is backed up daily at the EOD (End of Day).

There are generally 15 counters for transaction in Big Bazaar. The recording at the transaction at each of these
counters is done.

The average no. of transactions made per day varies from 3500-4500 and all transaction data is recorded at each
terminal and stored at the database.

Inventory Management using different software

Information System is very instrumental to reduce costs, improve optimization and efficiency, providing a value
proposition to the consumers and increasing the valued customer experience in every area. Achieving cognizance in
activities across various procurement processes of inventory is easily done by using specialized software. Now
Information System is playing an indispensable role in most of the critical functions of Supply Chain, Operational,
Financial & Accounting activities and HR. IS has helped them to reduce processing time and enable them to respond
efficiently to the changing customer requirements. This has also helped them a lot to reduce the cost and expenses
of operations through reduction in unnecessary wastage.
Other than from ERP’s, Big Bazaar uses some other methods like Bar Code Technology, CCTV and RFID. Bar Code is a
popular device which is used to identify and point the items in the supply chain of the business while RFID (Radio
Frequency Identification) removes the limitations of Bar Code. Big Bazaar also uses CCTV’s installed in different
locations around the store such that entire functioning and live activities taking place in a store can be monitored
closely by a human operator.

FLOW CHART OF INVENTORY MANAGEMENT SYSTEM

QUESTION 3: FOR EACH IS IDENTIFIED, WHAT ARE THE MAIN TYPE OF DATA STORED INTO THE
SYSTEM?
1. ITEM CATEGORY

 An item category is a logical classification of items that have similar characteristics. A category set is a
distinct grouping scheme and the flexibility of category sets allows you to report and inquire on items in a
way that best suits your needs.Each inventory item belongs to certain category. Examples of categories:
vegetables, fruits, dairy products.

 Product group is subset of item category, Grouping of similar products. The product group type specifies
the criterion by which grouping takes place (for example, size). The product groups represent the instances
of this grouping (for example, small, medium, large).

 Product groups are classified according to whether they are multi-level or single-level. A product group is
multi-level if it contains other product groups. However, the lowest level in a product group hierarchy
always consists of materials. A product group is single-level if its members are materials only. A material
or product group can be a member of more than one owner product group.

2. ITEM NAME AND DATE

 It is a discipline of deciding what an item will be called, and is very similar in concept and approach to the
process of deciding on a name for a company or organization.The date on which the inventory transaction
occurred.

3. ITEM NUMBER

 Item numbers help uniquely identify items, they serve as a shorthand, or abbreviated item description.
When you are searching your inventory, making transactions, filling orders, filtering or searching reports,
item numbers really come in handy. Instead of typing descriptions that can be hundreds of characters long,
and hard to distinguish at a glance, most companies can use items numbers of only five or six characters
or numbers in length. It makes it easier to use your inventory software, and anything that makes
something easier, improves the chances that it will get done.

 STOCK KEEPING UNIT CODE- An SKU is a unique item, such as a product or a service, as it is offered for sale
that embodies all the attributes connected with the item that distinguish it from other items. These
attributes might include but are not limited to the brand, size, color, manufacturer or warranty. Thus, a
code that holds all this information about an item gives it a unique stature in inventory, which means that
tracking and recalling a particular item becomes easy. Also, since the code holds all the relevant
information about the item, someone adept at reading the code can know everything about the item
without having to go and check ‘the side of the box’.

4. ITEM DESCRIPTION

 All of your items have well defined, unique descriptions, for many of the same reasons that apply to
locations. Without good descriptions, people can become confused about whether or not they have stock
on an item, or what items needs to be ordered. It can also be hard to search for items in reports, or find
similar items when searching your inventory system.

5. ITEM COST
 The item costs of a purchased item include the price paid for the item and any other direct costs for getting
the item to the plant, such as inbound transportation, insurance, duty, or taxes.

6. ITEM LOCATION

 The Item Location is a file of items that are stocked at a specific location. The item location tracks item
costs and quantities. Also, the item location records and defines if the item is tracked by bin and defines
replenishment information for the item. At least one item location record is required for each item master
record, if the item is a stock item and you track quantities.

7. BATCH NUMBER

 Batch numbers are given to a group of items. For example, juice bottles produced together. A batch
number is associated with information about the items. Most common information is production facility
name, expiry date and manufacturing date.

 Thus, items with the same batch number have the same expiry date. Batch numbers can be found on all
packaged food items and medicines. Batch numbers are used to trace raw materials too. For example, a
fabric manufacturer can trace back which dye was used to dye the fabric by noting down batch number of
the dye in the batch information of the fabric.

8. UNIT OF MEASURE CODE

 Units of Measure, things like ‘pcs’ ‘kgs’ ‘bs’ ‘bags’ etc. give meaning to quantities and they belong in their
own separate place, outside of descriptions and the numeric quantity fields. Using well created and
consistent units of measure will make stock levels, shipping quantities, and ordering quantities, easier to
understand.

9. BAR CODE

 UPC or EAN are part of a barcode. They are unique identifiers for products. These codes are printed on
most consumer goods, like electronics, clothing, accessories and other physical merchandise. These codes
have to be filed/applied for and are granted to the applicant entity after an approval process. There may
also be some fees involved in the process.

 The key differentiator with the SKU Code is that a retailer has the freedom to create their own SKU codes
and incorporate them in the inventory system without having to adhere to a larger tracking scheme or
global standard. With SKU, a retailer retains the flexibility of the length and characters in the code.

 This given them the ability to control the size of their inventory, changing manufacturers or wholesalers
without the hassle of a system overhaul by internally mapping their product SKU codes to that of their
suppliers or buyers.

10. STORAGE BIN

 The smallest available unit of space in a warehouse is called the storage bin. It describes the position in the
warehouse where the goods are or can be stored.

 A coordinate system is used to locate a storage bin. For that reason, a storage bin is often known as a
coordinate. For example, numbers 01-02-03 indicate that a particular storage bin is located in row 1, stack
2, level 3.

 Several additional characteristics of storage bins are used for their description, such asStorage bins are an
important part of the warehouse management system (WMS), the main part of the supply chain
controlling the movement and storage of goods and/or materials within a warehouse, while processing
the associated transactions, including shipping, receiving, put away and picking.

11. TRANSACTION DETAILS

 The date when the inventory transaction was performed. The inventory transaction type, which can be one
of the following

 Receipt, Issue, Transfer, or Adjustment for transactions originating in the Inventory module; or Invoice,
Credit memo, or return for transactions originating in another system module and the reference number of
the transaction

12. VENDOR’S INFORMATION

  A company uses to manage a comprehensive set of records about a company's suppliers. This data, would
include all relevant information about the goods and services being sourced from the suppliers, such as
procurement history, supply categories, inventory data, contract records, purchasing records, and other
key information about the supplier-business relationship.

13. NUMBER IN STOCK

 The number of an item. identifying number used for a product available in a physical warehouse or
inventory system. A customer can order a product via a stock number; warehouse staff then use the stock
number to find the location of the product (stock) with a product location system, and pull and ship the
product to the ordering customer.

QUESTION 4- FOR EACH SYSTEM, WHO ARE THE MAIN USERS, WHO PUTS DATA INTO THE
SYSTEM AND WHO MAKES USE OF IT SUBSEQUENTLY.
Who puts data into the system?

SAP data entry operator puts data into the system

Who makes use of the data?

Top level managementuses data for:

ItAllows easy scalability: SAP system is designed exactly keeping this need in focus. You can develop on the initial
implementation and scale up smoothly as per your specific requirements.

Forecasting: Since SAP ERP systems are designed to provide you the options that help in generating company
forecasts. It is important that as the manager of your own company, you have access to the best accurate
information related to your business so that you can chart your path in the future. With the detailed information
stored in the SAP system, you can easily refer to the real-time facts and figures, to prepare realistic assessments of
your business and make informed decisions.

Data helps to promote flexibility: By integrating SAP in your business platform, you can aim to achieve a greater
amount of flexibility in adapting to changes in the market dynamics. SAP-enabled company structure, you can
actually adapt and evolve and smoothly sail along with the ups and downs of the industry.

Create impactful communication: Whether it is an internal company-specific communication you are looking at or
marketing communications, data generated from SAP can help you make them more impactful. For instance, you
can build a more robust reputation management structure and focus on effective marketing strategies that
generate higher ROI every time.

Middle Level of Management

Material Management uses data for

Material Management data handles material/external service procurement process, inventory management, and
vendors’ invoice verification in the entire organization. begins with determination of organization’s requirements,
and then follows by determination of source of supply, material procurement from external vendor or internal
procurement, goods receipt in storage location and issue to production lines or costs objects including project; cost
center; asset; order, and finally is finished through invoice verification.

Project Management uses data for

  Defining project structures including Work Breakdown Structure (WBS) and activities
 Links to P6, Risk Manager, and Microsoft Project in program or project levels
 Defining project templates and using them for further project creation
 Defining access level on any project structure component Project scheduling
 Entering actual dates for project activities and applying rescheduling
 Progress planning through different methods

Logistics Management uses data for

 Goods Receipt Process for Inbound Deliveries/ Goods Issue process for outbound delivery
 Batch management
 Handle Unit Management
 Shipment
 This data serves different purposes in the "life cycle" of a shipment

Sales Management uses data for

 Maintain and categorizing customer information based on various parameters
 Presales activities (Inquiry / Quotation)
 Management of short term/long term contracts and schedule agreements
 Sales order creation with various price procedures including graduated price and discounts
 Special sales process management
 Inter-company sales processes
 Service and Project oriented sales processes
 Outbound delivery creation as warehouse notification for collecting and issuing goods to customers
 Shipment creation including outbound delivery and vehicle information
 Credit management
 Management of discount and promotions are done
 Return order sales

Inventory Management uses data for

 Inventory management deals with the management of stock, either on value or quantity basis.
 It includes planning, entry, and keeping records of all the movements of goods.
 Goods movement creates a document that updates all the stock quantity and value in the inventory that
is known as the material document.
 A material document is referred by a document number and document year.

Financial Management uses data for

Financial accounting responsibility at first glance is recording economic events, processing and analysing data and
presenting the results of this operation in the form of financial statements
QUES. 5 Identify the various reports that can be generated with the data/inputs identified. How these reports
would be useful to the organization (summarized, sorting, merging, simulated etc.)

What is an inventory report?

An inventory report is a summary of a retailer’s existing stock. It distils details like how much stock you have, which
products are selling fastest, category performance, and other information about the status and performance of
inventory. There are many types of inventory reports you can use, each serving its own purpose.

How to create an inventory report?

Consider your tech stack — in other words, the technology tools you use to run your business. You’ll want reliable
inventory management software to speed up the process, avoid human errors, and sync data across tools. In
fact, 15% of inventory distortion issues are due to software that won’t integrate. While you technically can use Excel
spreadsheets and manual reports, modern tech like Vend’s POS system will make inventory reporting easier, more
accurate, and more valuable. “Retailers with a POS system can generate reports more easily than those not
tracking sales and inventory at the SKU level. Once you’re all set up, it’s time to run the data.

1. Build your list of items

Export this from your POS, inventory management software, or another database that has the information. Include
basic information like how many units you have on hand, where the units are located, which variants you have,
serial and numbers, price, and other basic information. The information you include will largely depend on the
questions you want answered.

2. Establish your timeframe

It’s important to pull all metrics from the same timeframe, otherwise you’ll have mismatched data and
discrepancies. You might look at a year or drill down to the hour. And if you’re comparing periods, ensure you’re
comparing apples to apples. In other words, if you’re looking at sales numbers for June compared to November,
you’re likely going to see a big difference due to holiday shoppers.

3. Run your reports

Then it’s time to choose which reports you’ll run and generate the numbers. Guillot recommends starting with auto-
generated, or canned, reports. “POS dashboards and canned reports are a great place to start your analysis,” she
says. “But keep in mind that without an enterprise reporting system or best practices to recording your inventory
ownership over time, it’s rate that you’ll get an accurate look at your end-of-period (EOP) inventory.”

Decision of How Inventories are Maintained

Then coming to how the store manager decides the level of inventory, the store manager inspects the stocks time to
time and also the demands of customers. Manager maintains the Stock – in & Stock – out, so that he can decide the
level of inventory. He also has seen the trends in the requirement of inventories, as for e.g. he told that apparels are
ordered approximately after 45 days. For every sample of clothes, they have a backup of 10 pieces.
 Also, Big Bazaar uses the concept of Minimum Base Unit (MBU) in which the minimum number of stocks is
maintained for every item present in the store. For example, if the stock for any item goes below 50, then
immediately an Order Quantity report is automatically generated by the system which is sent to the vendor who
then provides the required stock of items.

Apart from these, the Goods Received Report (GRR) is maintained to check for the items which are actually
provided by the different vendors. However, in case, if a greater number of pieces is required, they first ask other
big bazaar location such as that of Patia etc. but if, even then they fail to meet the demands of customers, they go
for “Transfer of Interest”. In this they prefer sending the customers to pantaloons, as it is also of Future Group,
instead of losing them.

Besides these, the sales of items are affected by the seasons. For example, during winter the sales boost up and
additional quantity is demanded from vendors. Recently Big Bazaar has undergone tremendous technological
advancement, as its supply chain has become completely computerized. Once the product is sold, automatically, the
computer sends the request for back up.

Types of inventory that are created

1. Inventory on hand

Inventory on hand reports indicate how many product units a retailer has in each store, along with their current
stock value. This is essentially a measure of how much capital you have in your inventory, which helps with
reordering, forecasting, budgeting, and financial planning.

2. Low stock

Retailers lose some amount of money every year because of out-of-stocks, overstocks and returns. Low stock
inventory reports tell you which items are running low. Considering the cost of out-of-stocks, this report is crucial. If
you frequently have stockouts, customers will no longer rely on your store and will look elsewhere for their
shopping needs. This helps you stay on top of low stock items and be proactive in reordering.

3. Product performance report

These inventory reports tell you which products are the most popular and profitable. You might look at the gap in
between purchases. For example, if there was a long time between the first and last sale date, you’ll want to
investigate why it’s not selling quickly. And if you have items that are flying off the shelves, you might consider
biggest orders.

4. Shrink

While it may seem small, those are profits that you worked hard to earn. Shrink reports can help you monitor rates
over time and determine if there’s a bigger problem you need to address.
5. Benchmark comparisons

While industry averages are helpful, they don’t account for the nuances that each retail store faces. The best
comparison you can make is a comparison against yourself. Over time, you’ll be able to establish benchmarks in
your data, so you can monitor over time whether you’re meeting those standards.
“Each individual report will reveal a slice of what’s happening in your business, “Triangulating the information of
each of these reports over time will sharpen your analytical skills and help you manage future inventory
investments.”