What is stock level?
Stock refers to the quantity of goods (raw materials, consumables and supplies, semi-finished and finished products) in a warehouse at a given time.
The quantity of stock level is determined by recording receipts and issues. This is usually done using warehouse management software or a warehouse management system. The stock level is also determined by stocktaking. The value of stock can be calculated using various methods. In many cases, the stock quantity is multiplied by the so-called ‘moving average value’ of the goods.
The moving average value results from several past values and the present value. The average value is called ‘moving’ because it changes from period to period on a moving basis.
An important indicator in this context is the average stock level. The average stock level is the basis for the optimum order quantity. To determine the average stock level, you need to look at the stock figures from previous years. This analysis may reveal certain patterns that make planning easier.
