User talk:Amasaib

Just to give some information about Inventory Management and need other contribution and or comments,,,,

Objective of Inventory management:

Inventory must be viewed as a positive contributor to corporate profitability. To that end. management must determine when various items should be ordered, how much to order each time, and how often to order to meet customer needs while minimizing associated cost.

Types of Inventory:

•	Normal Inventory is required to support replenishment process under conditions of certainty. In other words, if demand and order cycle ( or lead time) never change normal stock are all the organization would required to meet its costumer’s needs.

•	Safety Stock is held in addition to normal inventory to cover uncertainty in demand and lead-time. Its purpose is to protect the firm and the customer against stock outs.

•	In-transit Inventory is en route from one location to another. It may belong to shipper or the customer depending on the terms of sale.

•	Speculative Stock is held for reasons other than meeting current demand needs. Management may fear the price of needed raw material will rise in the future or that availability may be limited for some reason and elect to buy a large quantity in anticipation of either eventuality. Alternatively, a vender may offer an especially low price if a large quantity purchased at one time.

•	Season Inventory is accumulated in advance of a selling season. It provides Management the ability to stabilize production and maintain long-term labor force even when the majority of sales occurs during relatively small part of the year.

•	Dead Stock is inventory that no one wants at least immediately. The astute student will wonder why any organization will incur the cost associated in holding these items rather than simply disposing of them. One reason that might be that management expects demand to resume at some point in the future. Alternatively it may cost more to get rid of an item than it does to keep it. But the most compelling reason for maintaining these goods is customer service. Perhaps an important buyer has an occasional need for some items, so management keeps them on hand as good well gesture.