Executive Summary

This report aims at exploring the inventory management procedure followed by one of the well-
known Asian retailer brand called MR. D.I.Y. which deals in home household, electronic and
hardware products. Through research, it is found that the company manages its inventory well
by utilizing updated technology and procedures.

Coding method used by the company for controlling and tracking of its inventory is bar code
method. This makes controlling inventory a lot easier and provides better data which is rapidly
available.

Moreover, company performs an extensive and step by step inspection of its products to ensure
quality and quantity of materials used. In this process, it is also made sure that the final products
which are dispatched are those products which were authorized for issue by the warehouse
manager.

Furthermore, the process of dispatch of goods is explored along with the method used by the
company for stock recording. Since the company uses a computerized method for recording
of its stock so it helps them in calculating accurate figures and access real time data easily.

Finally, the report focuses on the costing method used by MR. D.I.Y. which is weighted
average method. In this method, the company recalculates the issue price every time after each
receipt.
Business Description

MR. D.I.Y. is a home improvement retailer in Malaysia set up in 2005. The organization retails
an assortment of households, electrical items and other hardware and have been devoted to a
difference in living styles of its customers. MR. D.I.Y. is a home-developed company with
more than 750 stores all through Asia-Pacific. The entirety of the stores are overseen
straightforwardly by the organization and they work in collaboration as a mini anchor tenant
with Tesco, Giant, AEON and AEON BIG.

Vision

“To be the largest home improvement retailer in Asia Pacific”.

Mission Statement

To create a globally recognized ASEAN retail brand. To maintain wide variety, good quality
and value of money; holding true of the company motto “ALWAYS LOW PRICES”.

Goals:

Major goals of MR. D.I.Y are:

1. First and foremost goal is to open an additional 300 new stores across the Asia-Pacific.
2. Secondly, they want to expanding their reach to new countries like Singapore and
Philippines.
3. Launch of MR. D.I.Y. “E-Commerce” platform.
4. Flagship store marks as the fourth goal.

MR. D.I.Y. begun as a homegrown store for equipment with its first outlet along Jalan Tuanku
Abdul Rahman in Kuala Lumpur in 2005 and now it has developed into a famous, giant retailer
of low price products.

Identification of Materials

Inventory management and control is a key component of running a successful business.

Having a lot of stock in warehouses ties up capital that generally could be utilized to put
resources into your business or to take care of tabs. Too little stock can mean you need more
items to sell and you lose income. So as to keep the perfect measure of stock available, you
need a framework that will give you a chance to manage the stock.
Coding Method Used:

MR DIY uses bar code or Universal Product Code (UPC) system for controlling and tracking
inventory. In this method, each product has a label that gives data about the thing, for example,
what it is, the place it is found and what value it sells for. The code is checked with a hand-
held bar code reader at the money counters of the stores.

Advantages:

Using barcode as a coding method to control inventory has a number of advantages. Some of
them are:

1. Using bar code method eliminate the possibility of human error.

2. It reduces employee training time for MR. D.I.Y.
3. They are comparatively less expensive to design and print.
4. They improves inventory control for stores like MR. D.I.Y.
5. Barcodes provide better data and are rapidly available.

Receipt and Inspection

Components of Inspection:

With decreasing product life cycles and time-to-market, the challenge to convey quality items
on right time increases. With this expanding challenge, it is significant for an organization to
inspect the quality and amount of stock. The principle point of investigation is to forestall the
generation of non-standard things. This approves the amount of the items and confirms the
amount conveyed. At MR. D.I.Y., inspection of components like quality and quantity are not
overlooked. The components of inspection over there includes inspection of materials. In this
inspection process, inspection is done throughout the various stages to check that the right
amount of product with the right quality is delivered. This is done by technical staff at MR.
D.I.Y. Moreover, there is another component of inspection where called “supervision of
loadings” where it is ensured that the final products that passed inspection are the same
products that are packed up and shipped to their final destination. This help both customer and
the company to monitor that quality requirements for the product are being met and support
on-time delivery of quality products.

Advantages of components of inspection:

  This ensures that the right quality is provided to the customers thus maintaining a steady
development and a high standard of living.
 It will enhance the goodwill of the company because of high-quality products.
 It favorably affects the cost curve due to less wear and tear and wastage etc. for the
procurement of statement items.
 It increases the profitability of the company.

Issue and Dispatch

Authorization of issue:

The warehouse managers at MR. D.I.Y. have the authority to grant permission for inflow and
outflow of stock in the warehouse. Stock can not be oved from the warehouse with his
authorization. Every warehouse of MR. D.I.Y. has one warehouse manager who is responsible
for maintaining, receiving and distribution operations of a warehouse by initiating operational
and personal policies and procedures.

Dispatch of Goods:

To avoid confusion and prevent reporting errors workflows are documented and that staff are
provided with adequate training so that everyone is on the same page. Inventory is laid out in
a more practical manner which saves huge amounts of time for the warehouse staff on a daily
basis. After proper scheduling, when the time for dispatch comes, truck dispatchers are used to
move products from one location to another whilst keeping close communication with truck
drivers.

Records and Systems

Methods of Stock Record:

MR D.I.Y. uses a computerized system for the recording of its stock. This systems runs on
similar patterns as of manual one but are more flexible and the information is easier to retrieve
from this method. Since, MR DIY deals with a variety of stock items so using this computerized
method makes it easier to handle large data. There's just a one-time need to include the
information and afterward Sales Order Processing and Purchase Order Processing can be
coordinated in the framework. With the goal that stock adjusts and insights are consequently
refreshed thereafter as orders are handled by the organization.

Advantages of the Stock Record:

 1. Using a computerized stock recording system makes calculations easier and accurate.
2. It reduces the probability of missing or shrinkage inventory.
3. It provides real time management information.
4. It makes the entire inventory management process efficient and better.

Materials Accounting

Methods of Pricing Materials Issues:

MR. D.I.Y utilizes a weighted average cost method for its stock. In this strategy, the issue cost
is recalculated each time after each receipt thinking about both the complete amounts and
complete expense while ascertaining weighted average cost. This technique in general smooths
out the vacillations in cost and decreases the quantity of computations to be made, as each issue
is charged at a similar cost until a new group of material is received by the company.

Conclusion

By looking into the detailed inventory management method of MR. D.I.Y we came to know
how important it is for a company to manage its inventory well and use the most appropriate
methods of coding, dispatching and other activities in order to be successful in inventory
management. It can be concluded that inventory control is something that should be front-of-
mind for any company because it helps in maintaining the right balance of stock in the
warehouses. When a company has complete control over its inventory, only then it is able to
provide better customer service and get a real-time understanding of what’s selling and what
isn’t.