CE Inventory Solutions

What is Inventory?

Inventory is a list, record or register of items your business might Buy, Produce, Store, Use or Sell.

An Inventory is generally a list of physical products or materials, commonly called “Stock”.
However, it might also be of information: e.g. names, locations, dates, grades, group, data, etc.
When we refer to “Inventory” or “Stock” on our site, we mean Physical Inventory unless indicated.

Inventory acts as a buffer between Customer Demand and Supplier lead times. It is like water that is held in a dam, stored until required. The lead time is how long it takes to receive stock from your supplier, or the manufacture time. In our “dam” example, the length of time between rainfalls. Inventory is the total list of products stored until required, and is used not only for accounting, but for future resource planning.

The History of Inventory

Inventory accounting developed when humans first started storing foods / water for winter survival.

Early nomadic tribes learned to preserve and store foods for when times were “lean”. Their actions were possibly squirrel-like at first, but eventually their thoughts developed irrigation and agriculture. History shows that early writing eventually developed from symbols and images. These would represent the learnings of the people; recordings of what foods were good / bad to eat, easy / diffucult to catch or cultivate, and even where and how to do so. Early markings on products would show perhaps not only the maker of the pottery, but also the owner of the goods inside. Ownership and Usage would need to be accounted for, thus markings on pottery or stone, knots in twine or other basic forms would be used. These basic accounting methods developed into writing, mathematics, general inventory concepts and much more.

As time marches forward, we find Trade develops between tribes. Major commodities at first were necessities such as different foods, containers, livestock, tools and weapons. Later, luxuries such as materials (cloth and silk), jewellery, technology and eventually metals.

At first direct bartering was used, in order to create a “fair” exchange. As civilisations and cultures expanded into different regions, a common measurement was required to maintain a universal value. Thus Commerce was developed, and money soon replaced bartering.
Merchants especially profited from the use of commerce. They bartered with tribals to acquire their goods, then accounted for the transaction (using stone tablets or other writing materials), and sold the goods later at a different destination for a profit. This method is still the basis of inventory records and transactions today.

Modern Inventory Thousands of years later the Industrial Revolution saw Mass Production dramatically develop, especially with steam power. Entrepreneurs found that they could produce many items inexpensively, developing whole new industries. Humans now enter the fastest growth period in our history.

Modern technology has improved tremendously in the last few hundred years, and seems to accellerate all the time. Logistics thinking has developed far beyond just buy, hold and sell. Following World War II, Japan lead the way with technological development and manufacturing efficiencies. Countries previously at war for generations now trade openly with each other.

Computers and especially the internet have opened up International communication and trade to any sized business. Regarding inventory, they can manage far more information and data than ever before, can link people around the world instantly and can perform time-consuming calculations, forecasts and predictions in seconds.
Modern transport means product is globally available in mere hours rather than months or years, so inventory movement is now faster than ever… Supply Chains expand Internationally… and businesses grow into huge multi-national corporations.

The key question is: Is your Inventory Management still PRE-HISTORIC?

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