Chapter 1

Introduction

1.1 BACKGROUND OF THE STUDY

Cutting Edge Company is a store owned by SPC or Star Paper Corporation. It was incorporated on February 19, 1974. It is a premium men's lifestyle gift store showcasing the world's best brands in outdoor and travel gadgets, home and office tools, games, hobbies and electronics. Brands include Victorinox Swiss Army Knives, Bicycle playing cards and game sets, Brunswick billiard products, Parker pens and accessories, Buck knives and more.

1.1 BACKGROUND OF THE STUDY

(continuation)
The Cutting Edge Company does have only 4 branches. They dont have any updated website or even social networking pages to coordinate with the customers. Transactions were done manually, like book keeping, billing, information and inventory, it gave a hard time recording ordered items and keeping the records of
stocks.

1.2 Statement of the Research Problem

What problems are commonly encountered on the current Sales and Inventory System of Cutting Edge Company? How can we reduce costs for stocking, order fulfillment and material handling while improving customer service using the proposed system? What are the specifications of the system to make it user-friendly?

Cannot specify the exact amount of sales and item sold.

Complications on sales and Inventory due to human errors. Laboriousness and time consuming when it comes to generating sales and inventory reports for obvious reasons that it is done manually

1.3 General Objective

This project is aimed at developing an online Sales and Inventory System (OSIS) CUTTING EDGE COMPANY.

1.3.2 Specific Objective

To provide for a quick and efficient retrieval of information without any lag. To implement the software by conducting training to employees. To control inventory right at the cash register with point-of-sale (POS) software systems. To make better decisions about ordering and merchandising products. To provide costumers accurate information, fast transaction and accessibility. To help employees in the effective and efficient performance of their tracks more specifically in the recording and monitoring of sales and inventory transactions as well as the preparations of reports. The system will serve to a more in depth development and implementation of sales and inventory system and related studies. For future Researcher, This system will serve as guide to a more in-depth development and implementation of sales and inventory system and related studies.

1.4 Significance of the Study

Customer. This system will provide them an accurate information, fast transaction and accessibility. General Manager. This system will provide him with accurate, speedy and updated information and reports, keep track with the movements of inventories and efficient flow of sales transactions used indecision making. Employees. This system will help them in the effective and efficient performance of their tracks more specifically in the recording and monitoring of sales and inventory transactions as well as the preparations of reports. Researcher. This system will serve to a more in depth development and implementation of sales and inventory system and related studies. Future Researcher. This system will serve as guide to a more in-depth development and implementation of sales and inventory system and related studies.

1.5 Scope and Limitation

This study is delimited to the assessment of the existing sales and inventory systems flow implemented by the company and the introduction of online sales and inventory system. It is further delimited to the identification of the significance of the new system to the company, the costs relevant to its implementation and the persons involved in its operation.

1.6 Methodology of the Study

This chapter contains the discussion of the research design, the locale of the study, the respondents of the study, research instruments, and validation of instruments, research procedure and statistical treatment of the data used in the study

Chapter 2
Review of Related Literature and Studies

Foreign Literature
According to Jeff Wourio, online sales and inventory system are designed to immediately record any and all sales and inventory transactions. Not only does that mean timely and accurate sales tracking, but this system also lets one readily identify inventory levels, particularly when what you have on the books doesnt jibe with actual stock. Little is more maddening to a business owner than watching his or her staff bogged down with inefficient, unproductive responsibilities, from doublechecking his inventory disparities to seemingly endless cash-register reconciliation. Perhaps the greatest advantage to a comprehensive point-of-sale network is the freedom it can afford on personnel to devote their energy to what genuinely matters the most helping customers.

Foreign Literature
According to Donald Reimer and Ravi Nayar they disclosed that maintaining the right inventory levels is tough challenge. If not properly managed, the inventory can result in a significant expense. Looking over the shoulder is the lender who is concerned about the cost of carrying too much inventory which can affect profitability.

Foreign Literature
According to www.udatasolutions..com/lumbergear.asp that was founded in 2002,Unique Data Solutions began consulting with hardwood lumber companies to grasp the unique requirements of the hardwood lumber industry, and after years of research and development, Lumbergear software was rolled out. Despite the fact that we come from modest beginnings and have come a long way, they continue to provide their customers with quality service and innovative technology solutions. Lumbergear sales and inventory software is a powerful, affordable and easy to use lumber business management system that increases efficiency in the workplace. They give control of hardwood lumber inventory and costs. The system also features a core set of modules that make it possible to run lumber operations effectively, and get products to customers on time.

Foreign Literature
The Quasem Dry Cells Ltd is an old and premier manufacturing company of Bangladesh. The factory of the company is situated in Tangail district. The company mainly produced various types of batteries. The demand of the product of the company is high. So, the company has to follow a proper inventory management system. The company follows Safety Stock inventory management system. Safety stock system helps the company to fulfill its market demand. For instance, the demand of inventory is likely to fluctuate from time to time. In particular, at certain points of time the demand may exceed the anticipated level. In other words, a discrepancy between the assumed and actual usage rate of inventory is likely to occur in practice. Similarly, the receipt of inventory from the suppliers may be delayed beyond the expected lead-time. The delay may arise from strikes, floods, transportation and other bottlenecks. Thus, a firm would come across situations in which the actual usage of inventory is higher than anticipated level and or the delivery of the inventory from the suppliers is delayed. The

Continuation

effect of increased and or slower delivery would be a shortage of inventory. That is, the firm would face a stockout situation. This, in true, as explained in detail below, would disrupt the production schedule and alienate the customers. The company would, therefore, be well advised to a keep a sufficient safety margin by having additional inventory to guard against stock-out situation. Such stocks are called Safety Stock. This would act as a buffer or cushion against a possible shortage of inventory caused either by increased usage or delayed as the minimum additional inventory to serve as a safety margin or buffer or cushion to meet an unanticipated increase in usage resulting from an unusually high demand and or an uncontrollable late receipt of incoming inventory.

Local Literature
Salavador P. Catelo denoted the importance of the Philippine Retail Food over the past decade. The Philippines witnessed a substantial growth in the retail industry. Although there is dearth of recent literature and statistics to support this observation, a reconnaissance of places especially in the urban areas can attest to this. Growth is seen not only in terms of numbers but more visible in terms of size, investment on structure and modernization in operation.

Local literature
Motor Image Pilipinas (MIP), exclusive distributor of Subaru in the Philippines reported a year-end sales performance of 602 units, marking an increase of 100 percent from 2007. It also registered the biggest growth in performance in the Philippine automotive industry based on the figures released by the Chamber of Automotive Manufacturers of the Philippines (CAMPI). Subaru has been the fastest growing automotive brand since its arrival in 2006 and Motor Image has announced plans to expand its business in 2009. Since its arrival in 2006, Motor Image Pilipinas has continued to sustain its growth in the market with Subaru establishing itself as the premier sport-luxury in the country. In 2008, Motor Image launched three new models that further strengthened its position in the market; the luxury SUV Tribeca, the 300-hp WRX STI and the third generation compact SUV, the Forester. Aside from these three models, Motor Image has also made available other well- known Subaru models such as the Outback, the Legacy and Impreza 2.0R variants

Local Literature
According to www.helium.com Henry Sy started to work at an early age of 12, usually manning the small family sari-sari store and preparing the traditional way of recording the sales and inventory control. Shortly, Sy thought of selling small portions of their grocery items to accommodate customers buying small volumes of products. Thus, the concept of retail marketing came to his mind. He entered the buy-and-sell industry to obtained funds to start his own retail business. Sy imported retail products from the US and sold it in the Philippines and the rest as they say was history. Mr. Sy is now the CEO and the founder of the SM Prime Holdings- one the largest publicly-listed companies in the Philippine Stock Exchange.

Local Literature
A Research Study of Longjas Trading Online Sales and Inventory was conducted by the students of Leyte Normal University Computer Science Department. They develop a system with high levels of reliability and availability required of business-to-consumer Websites that requires not only great technology, but also great operational processes. Building a scalable, highly available application is a necessary process in becoming functional as an e-commerce entity. They have tried developing the most basic modules required in an online business, using MySQLserver, PHP and Apache Web server. All of the key processes and tools are covered in this store from retail storefront to back end management.

Relation to the Study

We use the same following language in making the system such as PHP and MySQL Server. Like in other company that we discuss we hope that the company we choose have the good outcome.

Chapter 3
Theoretical Framework

3.1 Statement of Assumption

The system includes a website where products from all branches are sold. A proposed online sales and Inventory for the cutting edge company will surely make the flow of their system ERRORFREE. The system has a High-level and Detailed Design. It improves cash flow, visibility and decision making The users are knowledgeable on the use of computers.

3.2 Operational Defenition

Customer Customer class Order Employee Point of sale (POS) Bookkeeping Inventory report. Inventory. Online. Program. Online Ordering System

3.3 Theories used in the Study

Database Management System for online sales and inventory system, which will help to provide the management of information, creation of sales and inventory reports and automation of business processes.

Chapter 4
Existing System

4.1 Description of the System

The Cutting Edge of Star Paper Company has proven us that they give good services to their customers. Their existing system is manual sales and inventory system. Transactions in Cutting Edge are done through walk-in method where the customer may walk in to the store and transact. The process of this method is simple yet effective. The customer will talk to the receptionist, and the receptionist will get the selected items. After punching the bar code of the item the buyer will pay for it. After that, the transaction is considered done. They also have website for checking their products but you cant buy or check any prices on their site and it makes their site unproductive.

4.2 Definition of data capture

There

is no data that is need for the customer to buy.

4.3 Inputs
Name

of Document: Customer Fill-up Form for contacting Cutting Edge Origin: websites No. of Copies: 1 Purpose: for questions and other purposes

4.4 Processes
4.4.1 ORDER Begin If Client is registered then Proceed to Select Product Else Proceed to Register End

4.4 Processes
4.4.2 REGISTER Begin Input Customer Info Save info to Customer database Proceed to Order End

4.4 Processes
4.4.3 Select Product Begin Select products on the site If Client is finish on selecting product then Proceed to payment Else Proceed to select product End

4.4 Processes
4.4.4 Payment Begin Select the type of payment Confirming the of items Proceed to deliver product End

4.4 Processes
4.4.5 DELIVER PRODUCT Begin Deliver product Accept payment Issue Receipt Issue Delivery Receipt Save transaction to Transaction Database Proceed to Generate Report End

4.4 Processes
4.4.6 PROCESS TRANSACTION Begin Accept Payment Issue Receipt Save Transaction to Transaction Database Proceed to Generate Report End

4.4 Processes
4.4.7 GENERATE REPORT Begin Get Record from Transaction Database Generate Report Hand report to Manager End

4.5 Files
Transaction

Log Contains Information on the transaction made by Customers. Customer Log Contains Information about the Customers Product List Contains products available on the store

4.6 Outputs

Sales Report Origin Staff Number of Copies 1 Purpose Use files as report for daily, weekly, monthly, quarterly and annual reports Recipient Manager Control Procedure Filed by Date

4.6 Outputs

Transaction Origin Staff Number of Copies 1 Purpose To record transaction made Recipient Transaction Log Control Procedure Filed by Date

4.6 Outputs

Receipt Origin Staff Number of Copies 1 Purpose Proof of purchase Recipient Customer Control Procedure Filed by Date

4.7 DFD
Context

Level

4.7 DFD
Level

4.8 Problem Areas

Time inefficiency takes the transaction longer for knowing the stock. Ineffective website the website is unproductive because you cant see the price or buy the product when you see it you still need to go to the shop. Time consuming finding files will be more time consuming in manual rather than online. Difficult to keep old records the segregation and the redundancy can be a problem with old files. Lot of paper work using of paper can be useless when it should be use once.