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CHAPTER I

INTRODUCTION

Background of the Study

The Point of Sales and Inventory System for Ticar-Nuñez Supermart was

developed in order to establish a system which aims to solve the problem that currently

exists within the Ticar-Nuñez Supermart located at Villareal Highway Poblacion Proper

Mambusao Capiz. No existing system signifies difficulty in making sales and inventory

transaction resulting to a delay in making reports. In this sense keeping track of the in and

out of products is another problem to be considered as well. In order to solve the existing

problems, the searchers proposed the Point of Sales and Inventory System for Ticar-

Nuñez Supermart. A Point of Sale and Inventory System is a software-based business

solution used to simultaneously track sales activity and inventory. Manufacturers and

trade resellers can both benefit from a through solution, where single transaction entry

records necessary details on the customer, products purchased, price and date while also

updating inventory levels.

Using Point of Sales and Inventory System allows for much greater accuracy in

stocking and product management. They encourage ease of interaction between

owner/staff and shoppers as transactions are processed and items move from the business

to the consumer. Point of Sale help provide better insight into which products are most

popular. It also allows for enhanced marketing, stocking and oversight of critical sales

objectives.
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Inventory systems save time for businesses by speeding up transactions while

raising accuracy. This allows for confidence in accounting and accountability among

employees as it is easy to verify how much money and what time transactions took place.

They also allow for consistent experiences in terms of customer service. People know

there is always a uniform interaction at the register that requires tendering payment,

taking a receipt and transition of ownership of products and services. This generates

confidence in a business and ensures on going consumer relationships. Systems are the

most common method of inventory control and sales processing in retail markets. In

using this Point of Sales and Inventory System you can establish the benefits you and

your business handling may have. First is time savings. The amount of time that can be

saved by a business is perhaps the biggest benefit of using a computerized inventory

system. In cases where a shop maintains all data manually, its owner must reconcile each

sales receipt with every piece of physical inventory. Depending on the size of the

establishment and how many different products are sold, this can be a daunting and time-

consuming task. The Ticar-Nuñez Supermart is a grocery store that is managed by one

person, the owner. The business sells different items or products like a typical grocery

store that we can see everywhere. Like some other convenience store, the business does

their physical counting of stocks manually.

Technically, Ticar-Nuñez Supermart in Villareal Highway, Poblacion Proper

Mambusao, Capiz is only using a manual system that may cause to duplication of

documents and work redundancy. The business is just depending on their manual listing

of products and inputs of data which is possible to commit errors. The business can’t

view their proper records of sales or income in a given time of the year. It also doesn’t
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have its proper listings of product. In some instances, lost items are just being ignored by

the owner.

Objectives of the Study

The general objective of the study is to design and develop a Point of Sale and Inventory

System for Ticar-Nuñez Supermart.

Specifically, it aims to:

1. create a system that can store the stocks information in Ticar-Nuñez Supermart.

2. create a system that can monitor the inflow and outflow of stocks in the store.

3. provide accurate summary daily, weekly and monthly inventory and sales summary.

4. determine the acceptability of the system in terms of functionality, stability,

maintainability, performance efficiency, compatibility, reliability, usability, security and

portability.

Scope and Limitations of the study

The proposed Point of Sale and Inventory System of Ticar-Nuñez Supermart covered

only the sales and inventory operations. It would provide the owner access to trace the

inventory of the remaining stocks and monitor the daily, weekly and monthly sales and

inventory. It could also generate printed reports of remaining stocks and sales filtered

through days, week and months. The inventory system was only concerned on the file

maintenance such as the inflow and outflow of stocks. The system was also limited to

input the barcode of stocks of Ticar-Nuñez Supermart. Acceptability of the system was
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determined by looking at its appearance, design, content, efficiency and operating

performance.

Significance of the Study

This study would be big help to Ticar-Nuñez Supermart in Villareal Highway,

Poblacion Proper, Mambusao, Capiz. It would lessen the effort and time spent by the

Owner to trace the remaining stocks of the items, thus enabling the services of the

customer to be fast. A side from this, the system could also give benefits to the Owner in

generating their daily, weekly, and monthly sales and inventory report faster. Moreover,

the following groups of the people could also benefit from this study.

Owner

The Owner can easily add and update the information in the system of Ticar-

Nunez Supermart. The system will automatically provide information to the Owner as to

the number of available stocks. This will help them decide as to what stocks they will

order depending on its availability.

Staff

The system will also be of great help to the staff for it provide an easy access to

the immediate response customer’s inquires will be easier because of the available

information provided in the system.

Customers

The customers can also benefit the system. Their needs be catered immediately

because the information is already provided by the system. The time of waiting when

buying will also be lessened.

Researcher

The researchers could enhance their knowledge by proposing a system.

Future Researchers

The future researcher could also use this study as their sample guide for their

future researchers that is also related to their system analysis and design project.

Definition of Terms
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The following terms were defined based on how it was used in the study.

Computer is a power driven machine equipped with keyboards, electronics circuit’s

Costumer is the one who gives his custom or trade, a purchaser or a person to be
dealt with (Webster Comprehensive Dictionary, 1996).
Database 

Inventory an itemized list of articles with the number and value of each item so
listed, as the stock of goods of a business. The process of listing articles, supplies, or
materials with the description, quantity and value of each goods or stock of a business
(Webster Comprehensive Dictionary, 1996).
Point of sale

Record

System
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CHAPTER II

Review of Related Literature

When updating from manual processes, the first system necessary is the POS

system because it is the core for business analytics by providing management with access

to Comprehensive historic sales information. POS software helps to identify “not only

daily and weekly POS performance, but also inventory levels by SKU and location, order

status, in-stock percentage (in-stock in a store as a percentage of shelf capacity), and

warehouse and store out-of- stocks” (Shapiro, 2008). Further research shows that a POS

system streamlines the process of entering inventory into a computer upon completion of

sales, thereby allowing for expedited inventory management for companies still doing

this counting manually (Caisson, 2013).

POS data can be used to create expected sales forecasts based upon previous

demand. This will impact purchase orders, which “should be determined by how much

end-users are likely to demand, so POS data can be used to forecast what end-users will
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buy” (Simon, 2008). Forecasts are a very useful tool when considering how to price items

and when to reorder additional units because they identify the frequency at which items

are sold. The flexibility and automation that a new point of sale system provides over

manual processes is a key motivator for upgrading systems. A POS system is a means to

collect and aggregate sales data automatically, which can then be used to produce a

variety of sales reports including: daily reports with historical data, six week history

reports, top selling categories, top margin categories, top margin customers, top margin

items, customer rank by sales, top selling items, and sales by time of day (Poland, 2011).

Specifically for the retail agriculture industry, a good system can show a manager which

plants are making the most money, which ones are stagnant, and which ones maintain the

highest holding costs. This knowledge is crucial when dealing with perishable goods.

(Youngblood, 2013).

POS systems can also tackle issues relating to seasonality that all garden centers

must consider. It is difficult to sell particular plants, such as fall blooming flowering

shrubs, during the start of the season comparative to others, like annuals for window

boxes or flower pots, which would sell quickly during that time. Conversely, that same

flowering shrub might outsell an annual greatly at the end of the season because its value

is not subject to seasonal obsolescence. Often times, “many retailers do not (fully)

consider seasonality in practice because of a lack of technical capabilities” (Ehrenthal,

Honhon, & Van Woensel, 2014). However, “by accounting for non- stationary demand in

inventory management, retailers can reduce inventory holding, handling, and stock-out

cost substantially” (Ehrenthal, Honhon, & Van Woensel, 2014).

Without the proper technology, there is a gap between a manager’s insight into

trends and their actual patterns. A POS system tracks the sale of individual categories of

plants immediately when they occur and manages every transaction completely. This

provides management with a greatly enhanced ability to plan orders, plant placements,

and adjust strategies for the seasonal nature of the industry (Lombardi, 2011).

Wallitsch Garden center (in [city, state] if available) implemented the

CounterPoint point- of-sale system to replace its manual system and as a result

experienced much greater flexibility in pricing. The company had access to new data

which allowed them to “price products individually based on margin, rather than

grouping products into one price point” (Anonymous, 2008a). This is a crucial ability for

retail agriculture businesses; oftentimes a company purchase will include a group of

different products offered at a homogenized price. These products are then sold

individually in the store with varying degrees of demand. Individual pricing allows

management to capitalize on those demand trends. Wallitsch Garden center experienced

further flexibility by using POS data to compare the price points offered by various

vendors, and in turn was able to make smarter purchasing decisions for those products.

Overall, the updated system helped manage and control inventory and increased the

profits of the garden center by approximately 8 percent over the course of a season

(Anonymous, 2008a). Coupling historical data trends with better buying helps to increase

inventory accuracy, reduce the need for end of year clearance sales, and ultimately reduce

inventory obsolescence. Lakeview Nurseries in Massachusetts utilizes a just-in-time

buying policy as a result of having an electronic point of sale system, and keeps a

consistent flow of healthy products all deliverable within five days (Harvey, 2013). Each
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day, millions of people take part in countless sales transactions across the globe, creating

a constant flow of value which forms the backbone of our economies. In general, sales

mean a transaction that takes place between two parties where the buyer receives goods

(tangible or intangible), service or assets in exchange for money. Thus, the process

requires each party to give up something in return for something valuable for them. On

the other hand, inventory means the raw materials, work-in-process goods and finished

goods that are considered to be the portion of a business’s assets that are ready for sales.

This explains that, business needs inventory available to make sales to the customer in

return for money which will generate the profits. There are two kinds of problem that are

faced by business in managing inventory level which are high inventory and low

inventory. Holding a high level of inventory for long periods of time is not usually good

for a business due to costs incur for inventory storage, obsolescence and spoilage. On the

other hand, low level of inventory is not good either as the business may face the risk of

losing potential sales and potential market share as well. In an attempt of resolving

inventory problems, the solution lies on efficient inventory management.

According to Tim Crosby (2012) in his study on ‘How Inventory Management

Systems Work’ stated that inventory management system is the rule in knowing which

products are selling and which are taking up shelf space for enterprises as well as smaller

businesses and vendors. The system balances the goal of ensuring customers always have

enough of what they want against a retailer’s financial need to maintain as little stock as

possible (Tim Zierden,(2009). Thus, the ability to track sales and available inventory,

communicate with 17 suppliers in near real-time and receive and incorporate other data

such as seasonal demand must available in the modern inventory management systems.
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According to Anton Dolinsky (2010) on his article about ‘Barcodes, sales and

inventory control’ stated that in the earliest days of inventory keeping, in order to forecast

future needs, the merchants wrote down purchases or looked down at how many units

were gone at the end of the day. However, this practice seems to be difficult to carry out

after the Industrial Revolution as the mass production became the main goals of business

together with improving customer experiences at the point of sale. In the early 1930s, a

team from Harvard University designed the first modern check-out system that used

punch cards that corresponded with catalog items. In 1960s, the emerged of affordable

laser technology development brought hope in reviving the concept. Then modern bar

code or Universal Product Code (UPC) was born and caught on just before the 1970s. As

a result, the power of UPC codes to help track and manage inventory improved

exponentially when the computing power became better at the same time. As the

technology development advance, another new technology for inventory tracking has

made its way into stores, warehouses and factories in recent years (Edward A. Silver,

2007). Radio frequency identification (RFID) uses a microchip to transmit product

information to a scanner or other data collective device. Thus, the constant ‘beep, beep,

beep’ of bar codes being scanned at the check-out lane represents the modern inventory

management systems of stock tracking.

Tim Bajarin (Jun, 2013) writes on his article ‘Bringing the Checkout Counter to

You’ that station or aisle where individuals transport and place products they have chosen

to purchase from the location is a checkout counter or cashier stand. The typical process

that occurs at checkout is that cashier scans and rings up each item on the cash register
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and obtains the total. The transactions at the checkout are process using POS system that

the retail store adopts according to its needs.

According to Kaplan, Karen in his article on Los Angeles Times entitle of "Do-It-

Yourself Solution: Small Grocery Chain Has Big Plans for Its Retailing Software", stated

that POS term is applicable for a retail shop or store, the checkout counter in the store

where transactions between customer and store can occur. The term Point of Sale is often

used in connection or relative with the hardware and software for checkouts POS systems

are being utilized in many different industries since its technology merge ranging from

restaurants, hotels & hospitality businesses, casinos, salons and as well as retail

environments. Currently, most of retail POS Systems were the most sophisticated,

powerful and user-friendly computer networks in commercial usage. Moreover, the POS

systems carry out more than just POS tasks where POS solutions available that include

fully integrated accounting, inventory tracking & management, open-to-buy forecasting,

customer relation management (CRM), service management, rental services, operation

reporting and payroll modules (Quorion,2011).

According to pollick (2003) inventory is the total amount of goods and/or

materials contained in a store or factory at any given time. Store owners need to know the

precise number of items on their shelves and storage areas in order to place orders or

control losses. Factory managers need know many units of their products are available for

customers’ orders. Restaurants need to order more food on based their current supplies

and menu needs. All of these businesses rely on an inventory count to provide answers.
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According to harms (2008) inventory is necessary for many businesses including

retail and manufacturing facilities. Maintaining appropriate inventory levels is crucial, as

to much inventory can be costly. An inventory management system helps control and

balance the flow of incoming and outgoing merchandise. For most businesses, a strong

inventory is advantageous for several reasons. Determining the most effective type of

inventory strategy is an essential elements for the success of a business. Without an

effective inventory strategy, the company may lose money because of shortages of

inventory or an axcess of inventory caused from ordering to many goods.

CHAPTER III

METHODOLOGY

Time and place of the study

This study will be conducted at Ticar-Nuñez Supermart located at Villareal

Highway, Poblacion Proper, Mambusao, Capiz. From May 2022 to December 2022.

Respondent of the study

The respondent of the study were the owner and staff of Ticar-Nuñez Supermart.

Through them, the researchers could gather information and can gather useful data as

bases for the study

Software Life Cycle Model

The system undergoes different kinds of cycle. First, is the “Planning” which

involves the concept, capacity and services which can be identify in the objectives of the

study. Followed by the “Analysis” then the “Design” which required translating into

logical that can be designated into different programming lastly is the “Coding” which is

the result of the different phases which involved the development of the software. This is

shown in figure 1.0

Planning

Analysis

Design

Coding

Testing
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Figure 1.0 The Waterfall Model

Software Development Phases

The researchers used the Waterfall Model as the system development life cycle

to develop a clearly defined standards and procedures of Point of Sale and Inventory

System at Ticar-Nunez Supermart. The Waterfall Model was used by the researches to

guide them to the software. As shown in figure 1.0, the Waterfall life cycle was

composed of planning, Analysis, Design, Coding, and Testing Phases. These phases were

orderly followed in order to a successful build computer software.

Requirement Phases

Before the researches planned and conducted how to design and construct the

Point of Sale and Inventory System of Ticar-Nunez Supermart, the following requirement

phases and procedures will be undertaken.

Planning Phase

In this phase, the researchers investigated the current operation happening in Ticar-

Nunes Supermart to find out what are the problems encountered in the said business. To

accomplish that, researchers planned to propose a system that will solve the current

problems happening in Ticar-Nunez Supermart. The requirements were required to

support in the development of the system.

Analysis Phase
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In the analysis phase, the researchers observe the flow of inventory system of the

establishment. Then, they analyzed the existing system and look for ways to address the

problems. The customer inquiries to the owner to trace the available stocks of an item.

The owner informs the customer the availability of the stocks and it cost. Then the

customer will pay the items to the cashier.

Inquire to
Owner/Staff

Stock query
1.) Owner
Trace the availability of Inventory Record Book
stocks and inform the
customer the cost.
Stock Manual Report

2.) Owner/Staff

Prepare list of order

Supplier

3.) Owner

Receives order and Order delivery/ Delivery Receive payment

4.) Owner/ Staff

Update Inventory
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Figure 2.0 The current Inflow process of Ticar-Nuñez Supermart

Customer

Order Detail

Store Personnel

Receives Order List

Order list

Store Personnel
Inventory Record
Book
Check the availability of
stocks

Stocks

Store Personnel

Receive the Stocks

Purchased Items

Store Personnel

Released Item to customer

Figure 3.0 The current outflow process of Ticar-Nuñez Supermart.

Design Phase

The design involved point of sale system to solve the need of the user. The

researcher made it easily to handle and understand the operation of the point of sale

inventory system for the benefit of others.

Coding Phase

In this phase the researchers translated the propose design into code in their

chosen programing language.

Testing Phase

Initial Testing. In this phase, the advisory committee tested the system and

suggestion are made for the improvement and accuracy of the system.

Final Testing. In this phase the complete system will brought to Point of sale and

Inventory of Ticar-Nuñez Supermart to determine the acceptability.