Inventory is the raw materials, component parts, work-in-process, or finished products that are held at a location in the supply chain.
Inventory management system is a computer-based system for tracking inventory levels, orders, sales and deliveries. It can also be used in the manufacturing industry to create a work order, bill of materials and other production-related documents.
At its core, inventory control works by tracking two main functions of your stock room or warehouse - incoming and outgoing. Understanding what you have, where it is in your warehouse, and when stock is going in and out can help lower costs, speed up fulfillment, and prevent fraud. Your company may also rely on inventory control systems to assess your current assets, balance your accounts, and provide financial reporting.
Inventory control is also important to maintaining the right balance of stock in your warehouses. When you have control over your inventory, you're able to provide better customer service.