Difference Between Supply And Stock

Difference Between Supply And Stock

The key difference between supply and stock is that, supply is a part of the stock to sell the product in the market whereas stock is the number of goods manufactured in the company. Stock and supply are just different from each other in a manner where stock will be fixed it can’t fluctuate with interval of time whereas supply can fluctuate with demand of market. It can be differentiate on basis of different properties and abilities which we will se in detail in this article.

Let’s discuss supply in detail to know more about it.

   What is Supply?

Supply is a part of stock in which product go to supplier to sell it in market. In other words supply is a process to sell the product in market. Supply may be rise, fall or remain stationary. Because as the need of market will increase or decrease the demand of supply will also increase. Supply can’t be remain stationary or constant it can vary with demand of market.

Nowadays new methods of production introduced. As time passes a lot of new methods coming in market which are making the production of products more easy and convenient. And result of that the level of competition in supply also increasing because every company wants to supply more and more products to gain profit.

Supply is a table for producer in which different quantities of goods have of different prices. To understand it in much easier way let’s take an example. If a supplier has different goods of different prices, say of ₹ 10 and ₹ 20. Then how much supply will he do for ₹ 10 and how much for ₹ 20. And the table which represents these quantities of different goods represent supply. It is a flow concept. And supply measures in per unit time period.

Supply schedule

Supply schedule is a table which represents various amount of commodities at different prices at which supplier willing to sell these commodities.. It a table which show relation between price and quantities.

     Types of supply schedule

1. Individual supply schedule

2. Market supply schedule

1. Individual supply schedule

A supply schedule in which we talk about only a specific supplier. It is a table which represents a specific commodities at a specific price which supplier to sell. Means when a supplier sell any commodities of specific price represents as table then it’s considered as an individual supply schedule. Let’s take an example to understand it . So there is supplier A bad supplier B. Suppose supplier A sells various commodities at various different prices and supplier B also sells various different commodities at various different prices. So the table which represents these two supplier specifically that table represents individual supply schedule.

2. Market supply schedule

A supply schedule in which we talk about all the supplier which willing to sell the product in market. It is a table showing various amount of commodities that all the producer in the market willing to sell at the possible price of the commodities.

Means when all the supplier willing to sell their commodities in market at the possible price then the table which represent all these , considered as market supply schedule. Let’s take one example to understand it in much easier way. So there are various different supplier who willing to sell their commodities in market at a possible different prices. And the table which represent the sum of these supplier in a table, considered as market supply schedule. In market supply schedule price will be same but quantities will increase.

Now there are two types of supply curve. Which represent the supplier in a curve.

  Types of supply curve

1. Individual supply curve

2. Market supply curve

1. Individual supply curve.

A supply curve which represent only a specific supplier.. It is a curve which represents a specific commodities at a specific price which supplier to sell. Means when a supplier sell any commodities at specific price represents as curve then it’s considered as individual supply schedule.

Let’s take on example to understand it . So there is supplier A bad supplier B. Suppose supplier A sells various commodities at various different prices and supplier B also sells various different commodities at various different prices. So the curve which represents these two supplier specifically that table represents individual supply curve.

2. Market supply curve.

A supply curve in which we talk about all the supplier which willing to sell the product in market. It is a curve showing various amount of commodities that all the producer in the market willing to sell at the possible price of the commodities.

Means when all the supplier willing to sell their commodities in market at the possible price then the curve which represent all these , considered as market supply curve. Let’s take one example to understand it in much easier way. So there are various different supplier who willing to sell their commodities in market at a possible different prices. And the curve which represent the sum of these supplier in a table, considered as market supply curve. In market supply curve price will be same but quantities will increase. In market supply curve, curve will become somehow flattered.

Function of supply

• Supply depends upon the price of commodities.

• It depends upon market value .

• It depends upon demand of market.

• It depends upon total stock of commodities.

Now let’s discuss about stock in detail to know more about it.

What is Stock?

Stock is total no of commodities which a company has. In simple word stock is total no of commodities which company manufacture. It doesn’t change with the demand of supplier or demand of market. It has fixed. When the demand of commodities increase then companies starts to increase their stock to give more supply of goods to supplier. As to get more profit as demand increases in market. Stock is also known as inventory. Stock is measured at a moment of time. As demand of stock is increasing by the supplier to full fill the need of market company tries to manufacture as much goods as possible.

Types of stock

1. Opening stock

2. Closing stock

1. Opening stock

As we know about accounting period which start from first of April and ends at last of March. So the demand of stock is increasing by the supplier to full fill the need of market company tries to the manufacturer which are unsold at the starting of the accounting period, that stock is considered as opening stock. Suppose a shopkeeper has stock of clothes which he want to sell. But the stock of clothes at shopkeeper which is unsold at the starting of accounting period, that stock will be considered as opening stock.

2. Closing stock

The stock which are unsold at the end of the accounting period, that stock is considered as closing stock. Suppose a shopkeeper has stock of clothes which he want to sell. But the stock of clothes at shopkeeper which is unsold at the ending of accounting period, that stock will be considered as closing stock. Closing stock will become opening next year. It won’t be wasted.

Function of stock

• Stock doesn’t depend upon the price of commodities

• It doesn’t depend upon the demand of market

• It doesn’t depend upon the supply

Also, Read

Comparison of Stock And Supply

• Supply is a part of stock to sell the commodities in the market, whereas stock is total no of commodities which company manufacture.

• Supply depends upon the demand of market whereas stock doesn’t depend upon the demand of market.

• Stock has independent whereas supply has time dimension. It may increase or decrease as the requirements of supplier.

• Supply generates revenue for the company whereas stock helps to full fill the need of market.

• Stock increases with increase in production of goods whereas supply increases with increase in stock.

• Supply measures in per unit time period whereas stock measures at a moment of time.

These are the main difference between supply and stock.

 

 

 

 

 

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