1

CHAPTER 1

INTRODUCTION

Background of the Study

Our life today is much justified by the advancement of science and

technology. We are now living amidst marvelous discoveries and sophisticated

inventions. The computer is considered one of the best machines that were ever

invented. Its value to various institutions and companies had already been proven. In

fact, computers have completely altered the structure of business or institution. One

of its most important uses is in terms of record keeping. Computers are used primarily

to automate and facilitate the flow of work in the organization, and helps in planning,

controlling, and facilitating the administration of business and Universities.

As the time pass by the technology trends improved in terms of machine and

different system. Many institutions and companies use different kinds of system. The

new systems that exist are used in order to lessen the work loads of their employees at

the same time they gained quick access of different transactions.

The development of every system now a day was adopted by different

companies or institution especially in office work’s needs.

Inventory system is a vital part of any retail business, Inventory system

provides you with critical information about the condition of your products, such as

whether you are low on stock and your inventory needs to be replenished. Inventory
 2

System also provides your customers with accurate information, letting them know

when items are out-of-stock, back-ordered, or pre-orderable. Failure to provide your

customers with this information puts you at risk of losing future business. Inventory

management also gives your insight into which products are selling well and which

products are not. This information allows you to make better business decisions on

how to market your products, and whether or not to carry them.

Its purpose is to keep track of what you have in your small store, large office

or product development factory. If you know what you have available for sale or to

build products, you can easily satisfy the needs of your customers when they contact

you to buy your products. The inventory system informs you when you need to

purchase more products or supplies. There are two main types of inventory systems.

Smaller privately owned stores may use a manual inventory system, where the cashier

manually keeps track of all items sold each day. At the end of the day, sold items are

subtracted from the total inventory count to get an updated number available for sale.

A technological inventory system tracks the purchases and gives you an updated

number of inventory items left for sale. Both systems require that you manually count

all of the products or items in the inventory.

PC Clinic Plus Computer Repair & Services Dagupan City, Pangasinan is

looking forward for the development of a system for the Office in order to speed up

the process of Inventory System. The researcher came up into conducting a study

entitled “Inventory System of PC Clinic Plus”. This study focus in the main problem

of the Inventory System and problems regarding consuming a lot of time during
 3

Employees Receiving Stocks.

For a very small business that carries a limited amount of inventory or that

turns over inventory slowly, a mechanized inventory system is unnecessary. The

business owner can easily keep track of how much merchandise is on hand with a

manual system, or simply by applying the "eyeball test" to see if it is time to order

more. The owner won't need to spend money on inventory software or take the time

to learn how to operate it. A manual system gives a small business owner a greater

sense of control. Rather than relying on a computer to indicate when it's time to

reorder, the owner can manage the process on his own. The need to view his

merchandise on a regular basis, such as when counting stock before placing an order,

gives him the opportunity to assess the condition of his merchandise, reducing the

chance of a customer receiving damaged goods. A disadvantage of manual inventory

systems is that they can be highly labor-intensive to operate. They require continuous

monitoring to ensure that each transaction is accounted for and that products are

maintained at the appropriate stocking levels. It is also more difficult to share

inventory information throughout the business, because the lack of computerization

makes accessing inventory records a more cumbersome process. The time spent

monitoring inventory levels could be used on more productive activities for the

business. A manual inventory system relies heavily on the actions of people, which

increases the possibility of human error. People might forget to record a transaction or

simply miscount the number of goods. This results in needless additional orders that

increase the company's inventory carrying costs and use up precious storage space.
 4

Inaccurate physical counts could also result in not ordering enough of a product,

meaning the business could run out of a crucial item at the wrong time.

The researcher observed the Inventory System process that the Office is using.

Since existing system being used is having time management problems and anxiety of

employee at their office, a substantial amount of time was devoted by the researcher

for relevant information. Outside consulting, literature review, and research were

conducted from the different Universities. Interviews were conducted with system

programmers to understand the characteristics of a system, interview with the users

was also conducted to gather information about the existing system. The developed

system is being supported by inventory management employees and with the help of

some staff of office PC Clinic Plus Computer Repair & Services of Dagupan City,

Pangasinan.

Objectives of the Study

This study aims to develop system for PC Clinic Plus Computer Repair &

Services of Dagupan City, Pangasinan

Specifically, it aims to:

• Flexible configuration that allows for backordering and display of out of

stock, Stock keeping Unit

• Minimize the time consumed by employees receiving, replacing stocks and

new stocks

• To reduce the workload of Inventory System employees

• Prevent shortages and production delays

• Track inventory levels in real time

• To make a smart decisions about when to reorder products

• No Double Entry of product

Significance of the Study

The study deemed to be very significant to the following:

1.) Inventory System Employee- will benefit from this study in such a way

that it will provide them record of transaction which can easily be

accessed when needed.

It would be easy for them seeking, updating and retrieving an employee

Account payment records / transaction.

2.) Clients- will benefit from accurate and faster transaction process of

Inventory Management System.

Scope and Delimitation of the Study

The developed system entitled Inventory System of PC Clinic Plus of

Dagupan City, Pangasinan. The proposed system has the capability to track, monitor

and gives an alert if a specific product reaches the minimum allowance stock amount.

A search index is also added for the users to easily track items from the warehouse

that needs to be replenish which include the product location, availability, description

and price of the item. Login account for different users will be created for database
 6

security purpose.

Definition and Terms

Automated System. In this study this term refers to the kind of management

accomplished with systems that aided by a computer unit

Cost Benefits Analysis (CBA). This refers to a collecting and organizing all the facts

pertinent to a determining the economic feasibility of developing a proposed data

processing system.

Computer. This refers to a functional unit that can perform a substantial computation

including numerous arithmetic operations and logical operations without human

intervention during a run.

Database. This refers to a collection of data with a given structure that are accepted

and stored as records.

Data Flow. This refers to the moment of data through a system from it’s to destination

Files. This refers to named set of records of processed as a unit

Inventory. This refers to stocks finished goods on hand and ready for selling.

Inventory System. This refers to the record stocks, transactions, and sales in the

computer.

Password. A confidential identification assigned to a user that identifies him\her to a

system.

Precise - Exact, as in performance, execution, or amount; accurate or correct

Accurate - consistent with a standard

Transactions - a transaction usually means a sequence of information exchange and

related work

Data – Representation of facts, concepts, or instructions in a formalized manner

suitable for communication, interpretation, or processing by humans or by automatic

means. Any representations such as characters or analog quantities to which meaning

is or might be assigned.

Flowchart - graphical representation of the "flow" of data through an information

system.

On a Flowchart, data items flow from an external data source or an internal data store

to an internal data store or an external data sink, via an internal process.

HIPO (Hierarchical Input Process Output) - HIPO for hierarchical input process

output is a systems analysis design aid and documentation technique for representing

the modules of a system as a hierarchy and for documenting each module.

Sales Report. This refers to a written report about the sales of the company, sales as to

daily or per year.

System. This refers to a graphical representation of the physical elements of the

system.

Stock Report. In this study, it refers to a printed report showing the description

quantity and the current amount of each item.