Even the simplest of organisations will have inventory in more than one physical location. As organisations get bigger, inventory will require active ‘management’ with more warehouses (godowns, as we call it in India), racks & shelves and stocks at project locations.
Take the case of multiple sales outlets, each with one godown. Each purchases items at different prices and sells them over time. You need to take a call on the value of stocks at each of these outlets as if they were independent units – and not apply the company average. With Tally.ERP 9, each outlet will act as an independent unit from a costing perspective. Sales from each outlet will reflect the appropriate cost, and not the company average (which can skew profitability of both outlets).
Seen at the company level, the cost behavior ignores these godowns – making reports and financial analysis appropriate at that level.
Godowns can contain godowns – to allow management to the bin level.
For various jobs (projects) and sub-jobs, the use of godowns and cost centres in Tally.ERP 9 give a high level of reporting and analysis – on inventory and financial aspects of jobs.