Inventory System

JÖNKÖPING INTERNATIONAL BUSINESS SCHOOL

JÖNKÖPING UNIVE RSITY

IMP ROV ING INV E NTO RY

M ANAGEME NT IN SM A LL

BU S INESS

A CA SE ST UDY

Master Project in International Logistics and Supply Chain

Management

Authors:

Lining Bai

Ying Zhong

Tutor:

Jens Hultman

Jönköping

2008-01

Master Thesis in International Logistics and Supply Chain Management

Title:

Improving Inventory Management in Small Business: A Case Study

Authors:

Lining Bai and Ying Zhong

Tutor:

Jens Hultman

Date:

2008-01

Subject terms:

Supply Chain Management, Inventory Management, Purchasing, IT,

Small Business.

Abstract

Introduction:

The growth of small business is fast and their impact on the economy is becoming bigger.

How to manage the inventory effectively and efficiently often is a challenge for these small

businesses. The study took place at HEM-SOL FORSALJNINGS AB, a company involved

in gym sports equipment wholesale. For HEM-SOL two inventory problems, stock-out

and overstock occur frequently. The company wants to improve its efficiency and is considering a change in the inventory management.

Purpose:

The purpose of this study is to investigate the reasons behind the inventory management

inefficiency in HEM-SOL, and then the proposed managerial suggestions will be presented

to deal with the issues.

Method:

The study is considered as qualitative single-case study. Data collection is mainly through

the interviews with the top manager and other staff involved in inventory control operations. Secondary data is retrieved from the information system to provide the annual purchasing and sales report about twenty items using a purposive sampling approach. Data

analysis follows the theoretical framework.

Conclusion:

Small businesses have limited financial resources and bargaining power. Long-distance

suppliers, big fluctuation of demand and lack of formalized inventory control system result

in HEM-SOL bad performance on...