Inventory management system (IMS)

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1. Introduction

The purpose of Mycroft Assistant is to make an optimal order to the supplier.

Through the system you enter your data on your company’s trading activity. You load data about current balances of goods, information about the history of sales, reserves, and goods in transit (ordered but not yet arrived at the warehouse). You also enter the settings according to individual characteristics of products and consequently get the output result. The system will automatically calculate and inform you if you need to place an order, including which items and how much, and explains why.

The Mycroft Assistant inventory management system makes recommendations, focusing on the following indicators:

1. response time (time of delivery, period of preparation of the order, operating time required)

2. available to order goods in real time – Delta (current balance, minimum balance)

3. generates a sales forecast for turnaround time (estimated daily sales)

4. analysis of goods in transit (generated purchase order)

The analysis is always performed on the current date; retrospective analysis is not yet available.

Purchase prices are determined automatically according to the supplier prices data loaded or, if not loaded, on the basis of uploaded stock lists according to the latest prices.

2. Inventory management system usage

1. You need to download data from your accounting system (optimally every day, in automatic mode) in Mycroft Assistant. The best way to do this is described in section A.

2. You need to log in to “Mycroft Assistant” (at http://i.mycroft2b.com ) and at the top click on “Inventory Management”:

IMS

3. When you log in, the workspace will open, which includes the following: at the top is a filter by company, warehouse, supplier, and ABC group. The Export buttons from Mycroft Assistant to external systems is also here; below left is an item tree of your catalog, on the right is a description of recommendations for the selected product.

4. It is important to understand that calculations are done automatically for the whole directory of items, after which you just work with the results.

2.1 Filters

  1. You can see the recommendations for each catalog item, but in most cases, you only need to work with the recommended positions. In order to show only the recommended position, you need to check the box in the “Filter” field, top left:

Show only recommended

You can set this option to be turned always on or off by default in the System settings.

  1. If a supplier has been specified for the products, then you can apply a filter by supplier. The suppliers available are displayed in a dropdown list in the “Filter” field. After a supplier has been selected, the catalog will display only that supplier’s products.

IMS filter

  1. You can select a product by its ABC group, according to the calculated values.
  2. In addition, you can select the storage (there is a selection of available warehouses) for which the calculation is performed. It is important to understand that for the filters by company and warehouse, analysis of the original data will be made only by the cross-section specified in the filter.

For example, if you have 3 warehouses: “Central Shop,” “Grocery Store,” and “Retail Outlet” with a total of 30 units (25 in the first, 3 in the second, and 2 in the last), then if you select the last two, the system will assume that you only have 5 units remaining. You can apply a similar filter to the sales analysis data: analysis is performed on data only from those sections that you have specified.

It is also important to understand that the recommendation will be sent to all stores together, so if you have an overstock in one warehouse and a shortage in the other, then the system will make a recommendation based on the overall needs of the warehouses selected.

  1. A similar filter can be applied by company

Caution: you can work with filters in real time as a count of the data for all sections will have been made in advance.

2.2. Item catalog

1. The catalog corresponds to the directory you downloaded and contains elements that belong (or not) to a group of products. You can expand and collapse groups, thereby gaining access to embedded products.

2. For the manager’s convenience, for each element and group, per-piece indicators are calculated by ABC group, current stock, sales, orders, and recommendations (to purchase):

IMS item catalog

3. The user selects items (or groups) for the supplier order by ticking the boxes to the left of the catalog. The exported (or printed) document will only include goods (or a group within the ranking) selected with a tick.

 

3. Recommendations

3.1. Text of recommendations

By clicking on the item, you can see the basis on which a purchase recommendation was made.

IMS text recommendations

The tab comprises three blocks, two of which you can minimize or maximize for your convenience:

3.1.1. General settings

At the top is the recommended item.

Below that is “History calculation”, which indicates the start and end dates of the calculation.

The “On date” field indicates the date of calculation, the default for which is today’s date.

The “Recommendation calculation method” and “Safety stock calculation method” fields are shown according to the item settings.

3.1.2. “General data” tab

IMS General data tab

This tab displays the raw data used for the calculation process as well as the performance calculation settings. For each firm and warehouse the following information is displayed:

“Stocks” – shows how much product you have now in stock, expressed in units.

“Reserves” (displayed only if the reserves option is turned on) – shows how many goods are reserved in stock.

“Min. stock” (displayed only if you have selected the method of calculating safety stock in a particular quantity) indicates the minimum reserve in stock.

“Delta” – this reflects the quantity of goods that you can actually manage. This is in fact the current balance of goods, net of reserves and minimum balance (if you have turned on these parameters in the settings). Delta can be negative if you actually have less product than you should within the product parameters.

The next three lines contain information about the system turnaround time, whereby data is taken from the settings. The final turnaround time is used in the calculations, as is “forecast time”.

These indicators are displayed for your convenience.

3.1.3. “The process of calculation” tab

This block contains the essence of all recommendations tabs, describing the process of calculation. The calculation uses the item settings and data: real-time data (e.g. delta and goods in transit) as well as historical data (e.g. sales history or orders).

IMS Process calculation tab

“The average daily sale” shows the calculated average sales forecast per day over time. The calculation of average daily sales is based on sales history (for a given period) of an item and on the calculation settings selected for the product. The very process of calculating the average daily sale is hidden, as it is difficult to display and unnecessary.

In the “Safety stock” section you will see the extent of the reserve stock the system recommends. The volume of the stock depends on the selected method (indicated in parentheses) and related parameters: days stored, corrections, etc.

Below, you can see the sales chart for your chosen product. Below the graph, the text describes the calculation sequence:

First, we calculate how much product will be sold before the next batch arrives. To do this, first we multiply average daily sales by the number of days needed for turnaround time. This gives us an estimate of future sales. For a full assessment of future consumption we add a calculated amount of safety stock.

In the formula for calculating (in brackets) you can see the months for which seasonal factors were calculated.

Below, we look at the rest of the item in the future. To do this, first we take a product that is expected to be available in the future (within a turnaround period) and believe that we will have it at our disposal. Then, we take the current item, which is currently at our disposal (Delta), and add to it the estimated future remainder thereof, thereby obtaining an estimate of its remainder in a future period.

From the remainder obtained, we subtract the estimated future consumption, calculated above. The result is a number that shows the extent to which future consumption will differ from future remainders of a given item. If the estimated value is less than zero, i.e. estimated consumption is more than the estimated remainder, this means that it is necessary to purchase more goods. The extent of this difference itself will be a preliminary purchase recommendation.

After calculating the preliminary recommendation, the system still has some work to do. First, it has to adjust the resultant recommendation to the desired multiplicity of goods, and second to the minimum order size.

In the event that after all of the above operations the final recommendation is greater than zero (i.e. the item is purchased), then the system checks if the “forecast horizon” (the purchase amount for the future) is indicated. If so, then the system will increase its recommendation in proportion to the recommended period of days. The system will consider the resulting value as a final recommendation, displaying this.

Recommendations are calculated for each analyzed company and warehouse, while each of the recommendations is estimated to the end, according to the item parameters (multiplicity, minimum order quantity). The final recommendation for all warehouses as a whole will be calculated as the sum of the recommendations for each warehouse.

IMS recommendations

Negative recommendations mean there is excess stock. A positive recommendation is for a purchase order.

3.2. Working with the calculation result.

To be able to work with the calculation result, the system allows you to export data manually and automatically, as well as to print the purchase order directly.

Both export and printing are performed on the data you see in the catalog that is ticked (if no boxes are ticked, the entire catalog will be exported). Thus, catalog filters are applied to export data. Only those items are exported (or printed) for which a recommendation has been made.

If you want to upload the data to a particular supplier, you need to specify that supplier in the filter. Only that supplier’s recommendations will be exported.

To calculate amounts and taxes you can use data originating from the download of delivery price data.

IMS filter warehouses

It is important to note that you can choose the source to refill the order. You can do this through the “Supplier” filter. If not specified, the supplier will be selected as indicated for each item. If specified, then only products typical to this provider will be selected.

You can also specify internal warehouses as the source (at the bottom of the supplier list). Then, instead of the purchase order document, an Internal Transit Order document will be generated (exported).

3.2.1. Print

In Mycroft Assistant you can immediately create a purchase order to a supplier in PDF format. To do this, after making your recommendations, click the “Print” icon on the top right next to the filter. After that, a new window will open the set of PDF files created, which you can both save to your disk and print immediately.

IMS print pdf

3.2.2. Export

The calculation results can be exported in several formats, first of all to an Excel file. To do this, you must click the Export icon (top right) and select the item from the dropdown menu. This will create a file with the recommendations and you will be prompted to save it to disk.

In the same way you can export in xml format for subsequent automatic processing if needed (for information on the format, go to Section “Integration” on the website).

4. Inventory management usage model

Mycroft Assistant helps you answer a single question: “Do we need now to buy something now? If so, what is the optimal composition of the order?”

To work “actively” with the Mycroft Assistant IMS subsystem, it is recommended you do the following:

1. Unload data from your accounting system.

2. Log in and make the adjustment calculation, according to management requests

3. The system then calculates the recommendations

4. Choose the products you want to order from those recommended (or all of them) and either export to your accounting system or immediately print the purchase order documents

To work “pro-actively” with the Mycroft Assistant IMS subsystem, you can do the following:

1. Unload data from your system

2. If necessary to purchase the item (i.e. the recommendations are not “0”), the system will automatically generate a PDF file with the orders and send to the email address you have specified.

 

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