Chapter I PROJECT OVERVIEW Project Background Humans have a better life because of technology. One proof of it is that computers exist. Almost every person uses a computer because of its importance in our daily life. One example why a computer is of big help is that businesses continue operating more accurately and quickly. To be more specific, a computer is needed in business to facilitate the processing of the different transactions and records of the business. Since then, computers had become a necessity. In 1980, an auto supply named “Gordon” was established at #1648 G.
Tuazon, M. Dela Fuente in Manila. At first, it only performed buy and sell and as the business grew larger, the owner thought of switching into wholesaling. As their success continues to grow, after wholesaling, they already began retailing and after retailing, they tried separating wholesaling from retailing and up to now that’s how they operate. Based from the owner, Iris Yao, the performance of their store lacks speed, accuracy and stability, causing them to lose customers. Gordon Auto Supply is having trouble with their records.
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They can’t determine their products which are running low and also sometimes they thought a specific set of products is almost out but only misplaced or transferred to another location. Even their product list is written manually which also affects the speed of transaction or any other records. Any other kinds of records like daily and weekly sales are also monitored manually which makes things difficult for them to handle. Because of these problems they cannot determine quickly the slow or fast moving products of their store.
Having no product list also confuses them on determining specific products that a customer wants. Sometimes they thought that this product is what the customer wants but because of confusion, they are giving the wrong products to their customers. Objectives of the Project The objectives of the project consist of the benefits that the study will achieve as a result of spending time and exerting effort to finish it and the objectives of the project will also help the firm improve their current system. General Objective
The study aims to develop a Lan-Based Sales and Inventory System that would provide Gordon Auto Supply a better maintenance to their reports, products and sales. This would also help them lessen the errors and increase the accuracy and efficiency of the store. Specific Objectives * To design a prototype of sales and inventory system that will help the firm operate faster, better maintenance and improved monitoring level in terms of business operations. * To develop a system that will help the firm determine the products which are in critical level and avoid confusion in selling specific product that can cause them to delay some transactions. To test, evaluate and implement the sales and inventory system and make use of what the system is capable of. Statement of Work Statement of work is necessary for specifying deliverables to be provided. It is also required to provide clear direction to projects if it is to succeed. Scope of the Project The project covers on development and the implementation of the Lan-Based Sales and Inventory System for the Gordon Auto Supply. The project also focuses on improving the current system that the firm is using and includes notification on products which are about to run low quantity .
The proposed project also has the capability to generate reports such as receipts, purchase order to the supplier, official receipts and their daily, weekly and monthly sales so that the firm can easily detect and fix different kinds of problems. The proposed system can add, edit, delete and search for products if necessary. Users can log in to the system if they have the security to use it. The system does not have the capability to operate online like accepting payments or any other kinds of online transaction. * * List of Deliverables
The deliverables are the documents that must be submitted to the firm and/or to the thesis adviser to increase the user’s knowledge about the system and further maximize the usage of it. * User’s Manual – a document that explains the basic instructions on how to properly use the system * CD Installation – is the transferring of the system into a compact disk and installing it so it can be executed. * Training Program – is a program designed for training the employees or the users of the system. This will help them to further understand the usage of the system. Testing Plan – This plan typically contains a detailed understanding of what the eventual workflow of the system will be. * User Requirements Document – is a document used in software engineering that specifies the requirements the user expects from software to be constructed in a software project. * Technical Documentation – refers to any type of documentation that describes handling, functionality and architecture of a technical product or a product under development or use. Example is the data dictionary of the system. * Program Specifications – is a list of requirements written for a computer program
Chapter II ANALYSIS OF EXISTING AND RELATED SYSTEMS Review of Existing System This section presents the manual sales and inventory system currently implemented at the Gordon Auto Supply. This presents the gaps/problems in the existing system in detail. Likewise, this contains the system description, process flow using data flow diagram (DFD) and strengths, weaknesses, opportunities and threats (SWOT) analysis for the current system. The Gordon Auto Supply is using a manual system to monitor the sales and inventory of their products. The company sells products such as Auto Supply items and other items.
The company has more or less 8 to 10 product lines with estimated 4000 items and 200 suppliers. Process Flow Diagram Figure 1: Context Diagram of the Existing System Figure 1 shows the context diagram of the existing manual sales and inventory system of Gordon Auto Supply. It provides an overview of the whole process flows. The proponents explain the environment of context diagram of the existing system. The entities associated with the system are the following: the Customer, the Warehouse, the Supplier and the Management. The inputs of the Customer entity will be the order, order payment and defective product.
The Warehouse entity will only input the order request. The input of Management entity will only be the requested supplies then for the Supplier entity the input is only the supply replenishment. When it comes to the system’s output to the customer it includes the necessary order rejections, sales invoice, official receipt, and purchased goods. For the warehouse, it will only be the ordered products accepted. For the supplier it includes order supply and ordered supply payment. And lastly, sales information and inventory information will be for the management. Figure 2: Diagram-0 of the Existing System
Figure 2 is The Diagram-0 of the existing system. It shows the system’s major processes, data flows, and data stores at a high level of abstraction. When we expand the Context Diagram into a Diagram-0, all the connections that flow in and out of process 0 are retained. Figure 2 diagram-0 is a deeper interpretation of the context diagram in Figure 1; it shows major processes that the manual system has specifically process purchased items, process check available stocks to the warehouse, process sales, inventory and customer records, process generated sales invoice.
The process begins when the customer orders for an item. The purchased item would then go to a process by checking available stocks through the warehouse. If the item is available, it will be updated in the inventory and then starts the transaction that will provide the official sales invoice to be received by the customer followed by the official receipt after the payment of the purchased products the sales will be updated. Each transaction will be reported to the management.
The management would then receive the summary reports of sales information, inventory information, customer information and the defective information after receiving the reports of the following transactions. The management would then order new products to the supplier. It will generate purchase order together with the payment of the ordered products. Lastly, when the company receives the new supplies, the system would then update the inventory record. Figure 3: Child Diagram of Process 1 Figure 3 is a child diagram of process 1; it elaborates more on the process involving the purchasing of an item.
First, the customer will inquire the desired products. When the company receives the purchase order, it will undergo to a verification process before it is passed to the warehouse. After the process, they will now look for the availability of the ordered items through the warehouse and when the purchase order is confirmed, the inventory information will be updated in the inventory record. Figure 4: Child Diagram of Process 3 Figure 4 is a child diagram of process 3 where it elaborates the process involving payments. Once the goods are confirmed, the company will receive the payment from the customer together with the customer information.
After paying the products, the company will generate an official receipt and the sales information will be updated to the sales record as well as the customer record that will be sent to the management. Then the products will be given to the customer. Figure 5: Child Diagram of Process 4 Figure 5 is a process 4 of child diagram that elaborates the process of ordering of products to the supplier. The management will submit a request to the supplier about the demand products. The supplier will analyze the list of the requested items of the company then check for its availability.
After analyzing, it will generate a purchase order to be received by the supplier together with the payment of the company for the requested supplies. After the transaction, the ordered products will be ready for the delivery. SWOT Analysis This portion of the study evaluates the Strengths, Weaknesses, Opportunities and Threats of the Existing System of Gordon Auto Supply. Table 1: SWOT Analysis of the Existing System Strengths * Manual system is easier to those who are computer illiterate * Manual system is more necessary especially during fortuitous events (e. g. brownout) * No indirect cost (e. g. lectricity bills) * Training program is not necessary| Weaknesses * Documents can be easily misplaced or get lost * Computing huge amounts are more difficult * Calculations done manually is time-consuming * Inventories are not monitored accurately| Opportunities * Growing demand for vehicle parts * Possible branch extension * Some competitors provide poor quality of products * Possibility of supplying for end users abroad * Manual system can adapt changes | Threats * Increasing number of competitors * Competitor’s price leverage * Creation on possible product substitutes * Customer piracy done by competitors|
The table above shows the analysis of the SWOT. It is a strategic planning method that is used to further explain the strengths, weaknesses, opportunities and threats of the existing system. This helps a firm analyze its present and future status. SWOT analysis can also guide a firm into success by determining its internal and external factors that are favorable and unfavorable in achieving its objectives. Strengths are the characteristics of the business that gives an advantage over other industries. For example, manual system is easier to those who are computer illiterate because it is the system that they are familiar with.
Manual system can be necessary during unexpected events like energy shortage because manual system can still execute its operations even with no electricity. Weaknesses are the characteristics that place the firm at a disadvantage relative to others. An example is that documents on manual system can be easily misplaced or get lost and because it is manually done, there is no back up of the records or reports. Computing large amounts are also difficult and will also take too much time for a person to finish it.
Opportunities are the external chances to make greater sales or profits in the environment. Example is the growing demand for vehicle parts that can cause the company to earn more profit. Manual system can also adapt changes like for instance that the firm already wanted to switch into a computerized system. Threats however are the external elements in the environment that could cause trouble for the business. Increasing number of competitors can be a firm’s problem because some of their customers might find their product too expensive and look for another auto supply that offers cheaper products.
Review of Related Systems This section shows the features of the related systems that are beneficial to manual inventory system of Gordon Auto Supply that might be useful for the development of the proposed project. The references gathered information from various books, magazines, internet and electronic sources that enable the references concept and developed system. Golden Inventory System Figure 6: Golden Inventory System 2. 1 Golden Inventory System is an advanced inventory system designed for wholesaling and manufacturing businesses.
This software has several advantages, including the Return Merchandise Authorization function, hierarchical groups for products, import and export functions for QuickBooks 2009, PDF and XML files, multi-currencies and expiration dates features. This inventory program has the flexible security function. It can define access rights for each employee of a certain company. Golden Inventory system works with MS SQL Server and MS Access database files. Now, the system calculates item costs using FIFO and Average methods.
It will able to create orders and invoices very fast and send them via email to the customers of the company. Golden Inventory System is a complete inventory management system that performs the functions of purchases, sales and payments. This system will guide the user through creation of vendors list, purchase orders, products list, receiving lists, sales, sale and payment receipts orders, and invoices. This is in addition to work orders for creation inventory assemblies, transfer orders between locations, customers and vendor’s balances and various types of reports for monitoring a business.
Golden Inventory works as single application as client server system and as distribution database system. The user will be able to work with remote outlets and warehouses in united integer even without reliable connection between them. It uses unique technology of the data exchange in XML format that allows quickly processing orders and synchronizing information with all the branches of a certain company. Review The Golden Inventory System have similarities with the proposed system some of features are almost the same such as recording transactions, generating sales and inventory reports, purchase orders, invoices etc.
That benefits the proposed system. SIMMS Inventory Software Figure 7: SIMMS Inventory Software 7. 1 SIMMS Inventory Software provides control of data pertaining to the receipt of goods, movement of goods within or between locations, the sale, removal or other disposition of goods and the precise valuation and status of goods remaining in an inventory at any given point in time. SIMMS Inventory Management Software provides a company with a major competitive advantage versus competitors who are unable to access the same strategic information.
SIMMS Inventory Control Software has been designed to accommodate the needs of both large and small businesses. SIMMS Inventory Control Software gives total control and access, depending on the permissions assigned to the user, wherever they are – in a warehouse, in an office, behind a cash register, working from home, working from a remote location half way around the world, in a service truck, in front of a customer, at the loading/receiving dock, or in transit from one location to another.
SIMMS does more than simply automate an inventory control process; it also provides robust materials management. Advanced Features Serial number and Warranty Tracking Tracking an items serial number, secondary level serial number and purchase warranty, sales warranty is a snap in SIMMS Software Manufacturer Lot Tracking Easily assign and track an items Manufacturer lot number in SIMMS Expiration Date Tracking SIMMS Expiration Date Tracking system tracks an unlimited amount of expiration dates from the time they are received into inventory until the time they are issued.
This information is permanently recorded in the system, allowing inventory control personnel access to a wealth of historical and validation information. Expiration Date Tracking is essential in the flow of inventory items that can expire such as life saving medication. Automatic Reorder Points SIMMS can define automatic inventory item reorder points per location in a snap, using the economic or maximum stock level requirement settings assigning the reorder point, order quantity, minimum order quantity and maximum on-hand values. Review
The proposed system is not capable of having advance features like SIMMS Inventory Software but the proposed system and SIMMS Inventory Software have similarities in terms of providing control of data pertaining to the receipt of goods, movement of goods within or between locations, the sale, removal or other disposition of goods and the precise valuation and status of goods remaining in an inventory. Operational Definition of Terms Availability Refers to the capability of the system to meet the specified requirements, specification and user’s expectation. The quality of being at hand when needed.
Present and ready for use. Checker Checks all the incoming and outgoing products to and from the warehouse. One, such as an inspector or examiner, that checks. One that receives items for temporary safekeeping or for shipment Collector The person who is assigned to collect the sales from designated areas. A person employed to collect taxes, duties, or other payments. Customer One that buys goods or services. An individual with whom one must deal. Someone who pays for goods or services. Dealer An individual or firm willing to buy or sell securities for their own account.
A person or firm engaged in commercial purchase and sale. Someone who purchases and maintains an inventory of goods to be sold DR (Delivery Receipt) A document that has been signed by the person receiving goods to show that they have been delivered a document sent by the post office, telling someone who has sent a letter by recorded delivery that it has been delivered. Functionality It refers to the ability of the system to perform the desired task that set of functions that something is able or equipped to perform. Capable of serving a purpose well. Maintainability
Refers to the attribute of the system which includes correctness, improvement and functional specifications. Characteristic of design and installation which determines the probability that a failed equipment, machine, or system can be restored to its normal operable state within a given timeframe, using the prescribed practices and procedures. Reliability It refers to the ability of the system to give accurate performance and how flexible the system is. Ability of an equipment, machine, consistently perform its intended or required function or mission, on demand and without degradation or failure.
Retail The sale of goods or commodities in small quantities directly to consumers. Selling directly to consumers. Consists of the sale of goods or merchandise from a very fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Supplier One who supplies. External entity that supplies relatively common, off the shelf, or standard goods or services, as opposed to a contractor or subcontractor who commonly adds specialized input to deliverables. Also alled vendor. Wholesale In large bulk or quantity. The sale of goods in large quantities, as for resale by a retailer. As the sale of goods or merchandise to retailers, to industrial, commercial, institutional, or other professional business users, or to other wholesalers and related subordinated services. Company A form of business organization, it is a collection of individuals and physical assets with a common focus and an aim of gaining profits. This collection exists in Law and therefore a company is considered a “Legal Person”. Database
A system intended to organize, store, and retrieve large amounts of data easily. It consists of an organized collection of data for one or more uses, typically in digital form. One way of classifying databases involves the type of their contents, for example: bibliographic, document-text, statistical. Digital databases are managed using database management systems, which store database contents, allowing data creation and maintenance, and search and other access. Inventory A list for goods and materials, or those goods and materials themselves, held available in stock by a business.
A company’s merchandise, raw materials, and finished and unfinished products which have not yet been sold. These are considered liquid assets, since they can be converted into cash quite easily. There are various means of valuing these assets, but to be conservative the lowest value is usually used in financial statements. Receipt A written acknowledgment that a specified article or sum of money has been received as an exchange for goods or services. The receipt is evidence of purchase of the property or service obtained in the exchange. The entire amount of income before any deductions are made Sales
Is the act of selling of products or services in return for money or other compensation. It is an act of completion of a commercial activity. Total amount collected for goods and services provided. While payment is not necessary for recognition of sales on company financial statements, there are strict accounting guidelines stating when sales can be recognized. The basic principle is that a sale can only be recognized when the transaction is already realized, or can be quite easily realized. This means that the company should have already received a payment, or the chance of receiving a payment is high.
In addition, delivery of the good or service should have taken place for the sale to be recognized. Inventory system Is basically a process whereby a business keeps track of the goods and material it has available. In its simplest sense it can be done manually by a count at the end of each day. In this way it is possible to keep a record of the goods coming in to the business and goods being sold. However this is only really appropriate for small businesses that do not have a lot of stock. For larger business it is more likely that a computerized system will be required.
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