1.

0Introduction
The advent of technology nowadays is unstoppable. In many aspects of people’s lives,
technology plays important roles to the business establishments; modern technology does the
very functional roles, especially a computer which makes people’s jobs easier, faster and
more accurate.
In technical terms, computer is a device, usually electronic, that processes data according
to a set of instructions. [THEF2000]. This is commonly used in almost every field of
business. That is why this age is called as the era of Information Technology. People would
really plunge themselves in doing manually gigantic amount of works to do. Indeed,
computers have become very important nowadays for its numerous advantages in the lives of
many people. Computer can do very big calculation in just couples of seconds. Moreover, it
can store huge amounts of data.

A Transaction Process System (TPS) is an information processing system for business

transactions involving the collection, modification and retrieval of all transaction data.
Characteristics of a TPS include performance, reliability and consistency. TPS is also known
as transaction processing or real-time processing. [TECH2010a]

In the past, sales and inventory systems were mutually exclusive systems, with one used
to sell merchandise and the other used to track it; modern point-of-sale systems incorporate
computerized access to the inventory control system, allowing for real-time updating. An
inventory and sales system working in unison effectively tracks product from the moment it
enters the store to the moment it leaves, barring losses due to shrinkage. [EHOW1999]

Some business with sales and inventory transaction programs must be adopt this
computerized sales and inventory system to lessen the workloads of the people. Most of them
have various products like shampoo, soap, toothpaste, milk and many more which are all
needed by the customers and thus need to be organized.

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 Since the other stores still practice their manual process in terms of sales and inventory
transactions, the researchers decided to propose a Computerized Sales and Inventory System
with Online Ordering that will improve, secure, and minimize time consuming in the current
procedure of the sales and inventory transactions.

In every transaction made, the business management has to record every transaction in
the store for reporting purposes which they manually do.

With the proposed system, it will organize and will make the transactions such as buying,
ordering and inquiring of products. The business management will also find it easy to
transact matters with less effort and consume less time in terms of searching of product status
and information, making reports and many more transactions.

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1.1 Statement of the Problem

1.1.1 General Problem

The general problem of this study is the manual procedure in performing

the daily transactions that causes delay, inaccurate data recording, unsecured files
and the like which provide inconvenience to both the management and the clients.

1.1.2 Specific Problems

During the research and analysis, the researchers found out that the
transactions in some stores are still operating manually which cause them to
encounter different problems such as the following:

 Limited means of product advertisement

The salesman is the one who promotes the products by displaying

tarpaulins of their products in some identified areas where many people can see
them to introduce their new products and some promos. The salesman also
distributes fliers to the people in the nearby places. Aside from that, the products
are promoted through words of mouth. Information about the establishment as
well as the products is passed from one person to another. The business will
advertise their new product and some promos every month. Since the business
establishment is not using a computerized based system, they do not use any
advertisement tools such as TV/Radio advertisement to get the customer’s
attention. The said method of product advertisement is not really effective since it
will only reach a limited range of coverage.

 Slow inquiry procedures

Inquiry of information is mostly encountered in the selling transaction.

This problem occur when the customer inquire about certain products information
through phone call or by personally visiting the store. The customer inquiries for
the information of certain product that the customer wants to ask such as the
price, the quantity, and the availability. If the customers ask for the product
availability, the salesman will look for the product in the display shelves. If the

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 product is not in the display shelves, the salesman will go to the stockroom to ask
the stock man to find one. In terms of product price and quantity, the salesman
has to look for the information in a record book where all the information of the
products is recorded. Such method is slow and time consuming making the
transaction inconvenient not only to the salesman but also to the customer.
Sometimes, the salesman gives more effort in searching but in the end, that
product is not available.

 Unorganized recording of products information

The manager is the one in charge about receiving of products. When the
stocks arrived from the suppliers, the manager will sign a form from the supplier
to ensure that the products delivered have already arrived or accepted. The
delivery man gives the delivery receipt to manager that contains the product
information list .After signing; the stock man will count and check the product to
ensure that the products delivered are complete and are without damage. Then
after that, the stockman brings the products to the warehouse and records the
product information one by one such as category, name, quantity, price,
description, unit price and mark up price. Since the recording is done manually,
the task is very laborious on the part of the stockman which causes errors in the
recording considering the number of products and redundancy of some
information may occur during recording.
 Limited ordering procedures

If the customer wants to buy a product from the business establishment

they need to personally visit the store to purchase the product that they want.
Customers will tell the salesman the product that they want to purchase then the
salesman will search the product from the display shelves. If the salesman locates
the item, the salesman will present it to the customer. If the product can’t be
found in the display shelves the salesman will go to warehouse to find for the
product needed. The business will accept ordering of products through phone call
but this is exclusive for their known and regular customers only. The said method

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 has a disadvantage for the business and also to some customers because only few
customers are allowed to do that kind of transaction. Since the business will not
accept unknown and far customers it will give the business a limited chance to
have bigger profit.
 Slow sales transaction

The salesman is the one who is in-charge about selling their products. The
customer will ask about products that are going to buy if it is available or not. The
customer will tell to the salesman the product, salesman will list down the product
information to be purchased into a sheet of paper such as product name, quantity
and price. Then, the salesman looks for product from the cabinet or displaying
area, once the salesman locates the item, the salesman will present it to the
customer. If the product can’t be found in the display shelves the salesman will go
to warehouse to find the needed product. The said procedure of performing the
transaction is slow causing delays

 Inefficient monitoring of product status

Monitoring of product status is done manually by the stockman. The

stockman will go to the displaying area and to the warehouse to identify which is
fast moving and slow moving of products. The stockman will do that transaction
daily, weekly and monthly so that they avoid experience out of stock and
overstock. The stockman should be aware also of the status of products like if it is
available, damaged, expired, sold out, and under critical level by checking it one-
by-one. In this transaction, there is a possibility to get not the exact status of
product because the stockman may miss to count some products making his report
inaccurate.

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  Slow payment procedures

The business establishment has limited means of accepting payments that

cost inconvenience for the customer. Since the business is not computerized, they
will accept cash, check and bank transfer. The salesman will list down into the
order list the products to be purchased like product name, quantity and price and
forwarded to the cashier together with the payment. Cashier will computing the
sum up of the product to be purchased. After computing the total bill of the
customer, the cashier submits the temporary receipt together with the products to
be purchased into salesman and give it to the customer. Cashier will compute the
total amount purchased including the discounts if there is any with the use of
calculator. Errors may occur when the cashier has to compute several items and if
the cashier attends to many customers.

 Time consuming generation of reports

The generation of reports is done manually by the stockman and cashier.

They prepare inventory report and sales report which contains the summary of the
transactions that made in business establishment. In preparing the report, the
cashier is the one keeps the temporary receipt and daily sales for report purpose.
Stockman will record the product status which fast and slow moving products
through writing in a sheet of paper for the summary of transaction made that will
cause time consuming. After writing the stockman will submit it into the manager.
These reports are done daily, weekly, monthly and yearly.

 Unsecured records and files

Files and records are written in record books, Sometimes printed papers
are attached only to the record book. These record or files are kept in a filing
cabinet or in a drawer where the front desk is located. Sometimes documents in
cabinet are not even locked and also putted it anywhere. It is possible to be
accessed by unauthorized person. It is more prone to damage or loss.

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1.2 Current State of the Technology

The business establishment has various procedures in making their transaction and the
following are:

 Product Advertisement

The salesman is the one promotes their products by displaying tarpaulins

of their products in some identified areas where many people can see them to
introduce their new products and some promos. The salesman also distributed
fliers to the people in the nearby places. Aside from that, the products are
promoted through words of mouth. Information about the establishment as well as
the products are passed from one person to another. The business will advertise
their latest product and some promos every month and sometimes if the products
newly arrived.

 Inquiry

Inquiry of information is mostly encountered in selling transaction. The

customer inquires for the information of certain product that they want to buy
whether it is available or not. The salesman will look for the products availability
in their display shelves. If the product information being asked cannot be found in
the display shelves, the salesman will go to their warehouse to look for the needed
products. And if the customer asks about the price of product the salesman will
look for their price in the price list written in their record book and presents to the
customer.

 Recording of the Products

The manager is the one in charge in keeping of files and records. All
records are written in the record book including the reports. Sometimes papers like
temporary receipt and delivery receipt from the supplier are attached only to the
record book. These reports are contains the summary of the transaction such as
sales and inventory reports. Only the administrator or manager has the authority to
access that records and files. In recording of new products they have done it

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 manually by the stockman and wrote it to their record book. This transaction will
happen if the purchase order arrived from the suppliers, the manager must sign in a
form from supplier to ensure that the products delivered have already arrived or
accepted. The delivery man gives the delivery receipt to the manager that contains
the ordered product information. After signing, the stock man takes the product to
the warehouse and records it one by one such as category, name, quantity,
description, unit price and mark up price.
 Ordering of Products
(Business to Supplier)
Ordering of products from the business to supplier is done by the manager.
Ordering of the products from the supplier is the most important transaction. First
the manager will ask the stockman to check what the stocks to be ordered. Then
stock man will go to warehouse to check their items in stockroom and list down
the product information then the list will be forwarded to manager for finalizing
the list of product and it’s quantity to be ordered. The number of items to be
ordered is based on the economic order quantity. The prepared list of purchased
order (PO) should be forwarded to the supplier. Sometimes the business used
phone call in terms of ordering of products but commonly they go to the supplier
to give personally the list of product to be ordered.
(Customer to Business)
The ordering of products in the establishment through phone call is
exclusive only for those who are known or regular customers. The ordered
products will be delivered to the place of the customers.
 Sales Transactions
Sales transactions are most usually do when there is the customer who
wants to buy. Customer can ask the salesman if the product that they want to
purchase is available or not. If the product is available and the customers decided
to buy the product, the salesman will list down the product information like its
name, quantity and price in a piece of paper and forwarded it to the cashier with
the payment from the customer. The cashier computes the total amount purchased
by the customer including the tax as well as the discount if they have. The

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 business will give a discount but it depends to the business if they have on-sale
and sometimes the other customer asking for the discount but only the
administrator or owner can give that, if the customer can get a discount from the
administrator or owner the total purchased will deduct by the discount given by
the authorized person. After that, the cashier will give the temporary receipt
together with the product purchased to the salesman and the salesman gives it to
the customer.

 Monitoring of the Products

The stockman is the one in charge about monitoring of products status.
The stockman regularly checks the all products in their storage area like display
shelves as well as the stockroom. In monitoring the products, this was done
manually. The business monitored their products status twice a week. The product
status that going to monitor is incoming, outgoing, damaged, lost and under
critical level products can be determined by checking it one-by-one from where
these products are stored. The stockman should be aware of the fast and slow
moving products to maintain the shortage or overstocking of products. In making
of reports, stockman will write the product information that going to monitor on a
sheet of paper then forwarded the report to the manager.
 Payment
In terms of payment, the customer who buys the products will tell to the
salesman the products to be purchased and it will be written in an order list the
product to be purchased like product name, quantity and price and forwarded to
the cashier together with the payment from the customer. The cashier will rewrite
the purchased product to the temporary receipt and compute the total amount of
the purchased product manually using calculator. After computing, the cashier
passes the temporary receipt together with the products to be purchased and
charges into salesman and the salesman gives it to the customer. Since the
establishment was not computerized-based system, they are not accepting credit
cards for customer payments. Only cash and bank transfer is to be accepted.

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  Generation of Report
The business will make reports like sales and inventory reports and it is
prepared and done manually. The submission of report will depend on them if it
may be done daily, weekly, monthly or yearly. The cashier is the one in-charge in
making the sales report like computation of the total sales of the day and he/she
was using a sheet of paper and calculator for the summary. And the stockman is the
in-charge in the inventory reports of the business, the stockman will prepared reports like
fast and slow moving of products.
 File Safekeeping
Files and records are written in record books, Sometimes printed papers
are attached only to the record book. These record and files are kept in a filing
cabinet or in a drawer where the front desk is located. Sometimes documents in
cabinet are not even locked and also putted it anywhere. Only the administrator or
manager has the authority to access that cabinet.

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1.3 Statement of Objectives

1.3.1 General Objective

The main objective of this study is to develop a Computerized Sales and

Inventory System with Online Ordering that will solve the problems encountered
by the management in their daily transactions.

1.3.2 Specific Objectives

Specifically, the system aims to:

 Advertise the products efficiently;

 Hasten the inquiry procedure;
 Organize the recording of products;
 Enable customers to order online;
 Fast track the sales transaction;
 Efficiently monitor products status;
 Make the payment procedures fast and reliable;
 Fast track the generation of reports; and
 Secure records and files.

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1.3.3 Scope and Limitation of the Study
 A module for online advertisement

This module is used to advertise and sell the products through online. This
module has the capability to post the products information online such as images,
prices, sizes, availability and many more, as well as the sale product and promos
and also latest and new arrivals together with the other information. In this
module, business will be an advantage to get more customer widely. It is also
bring up to business to compete the other business.

 A module for search capabilities

This module is used when customers inquire about product information.

This module has the capability to search and view the product information
accurately. The system allows the user to type the product name or product id in
the search box. The system displays product information such as product name,
product number, quantity, price and supplier.

 A module for file management with data validation

This module is used when the business has an incoming/ new product.
This module has the capability to avoid errors in recording of product information
and minimize redundancy of recording of product information. Information for
products can be saved, edited, updated with the use of the add products module,
wherein all data are saved on a database.

 A module for online shopping cart

This module is used when the customer wants to order a certain product
from the business establishment through online website. This module has the
capability to display all products that are available in a certain business
establishment. All of its information like product picture, name, quantity, status
and price will also be displayed here. If the customer wants to buy he/she needs to
register first to their website and has to give the correct information for the
communication.

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  A module for point of sale

This module is used when the customer wants to order a certain product
from business. This module has a capability to display and list all purchased
products such as product name, quantity and price. The proposed system has a
point of sale that will compute the total and display the products purchased by the
customer including the computation of vat.

 A module for product status monitoring

This module is used when the stockman needs to monitor the status of
product. This module has the capability to view the product status. The system
allows the user to type the product name or product number in the search box then
the system displays product status if it is available, sold, under critical level, and
over stocked.

 A module for payment

This module is used when the customer is surely buying a products. This
module has to support and accept the customer payments online through PayPal,
Credit Card and Bank Transfer. In the computerized system they only accept
Credit Card, Cash, Bank transfer, Corporate Accounts and Check.

 A module for reports generation

This module used when the user need to generate reports needed by the
owner or manager. This module has a capability to generate reports accurately by
selecting in “types of reports” which is sales or inventory report and report will be
show. In sales report it contains daily sales, weekly sales, quarterly sales, annual
sales, sales projection and sales analysis, quantity sold per item VAT sales
supplier price list. In inventory it contains product master list, product price list,
reorder list, item master list, purchase order list, adjustment report, fast moving
and slow moving items, back order list, damaged item list and expired product
list.

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  A module for login with user level access

This module used when the user want to access the system. The system
can be accessed by the owner, manager, stock man, sales man and cashier. To
ensure its security, each of them have a password to have maximum safety of the
files against unauthorized user. The user level access shows the position of every
employee. The form or module that employees can use depends on their position
in the establishment.

Limitations

 Re-issuance of receipt
During sales transaction, the computerized system will provide an official
receipt to the customer once after computation of the product be purchased. That
includes the company name, company address, and cashier in charge, products
list, quantity purchased per product, vat, date, time, total sales, change and
amount received from the customer. The re-issuance of official receipt to the
customer is not included in the proposed system. This is because the receipt
generated in the POS has a transaction number, but the business allows the
customer to re-print the official receipt with a valid reason.

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