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What Is Inventory Management?

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Rebecca Hunt Profile
Rebecca Hunt answered
Inventory management involves specifying the percentage and shape of stacked goods. In order to proceed with the regular and planned course of production and stock of materials, inventory management is required at different locations within a facility and within many different locations of a supply network.

• The scope of inventory management. Inventory management oversees the carrying cost of inventory, replenishment lead time, asset management, inventory valuation, inventory forecasting, inventory visibility, physical inventory, future inventory price forecasting, quality management, replenishment, available physical space for inventory, returns and defective goods and demand forecasting. All of these subsections of inventory management need to be balanced in order to keep optimal inventory levels. This is an ongoing process within a business as it needs to shift and react to the environment around it.
• Inventory management within retail. Inventory management requires a retailer to acquire and maintain an accurate and proper merchandise assortment when dealing with orders, shipping, handling and other related costs to ensure that they are kept in check. This process involves systems that help keep an eye on inventory requirements as well as setting targets, providing replenishment techniques, reporting actual and projected inventory statuses and handling the functions that are related to the management and tracking of material. This material needs to be monitored as it is moved in and out of storerooms and the inventory balances need to be reconciled. Inventory management within retail may also include cycle counting support, lot tracking and ABC analysis.

The main purpose of inventory management is to determine and control stock levels within the physical distribution. To do this it needs to balance the need for product availability alongside the need for minimizing the costs involved in stock holding and handling. All of this helps businesses proceed with their plans to produce and stock materials.
SMITA GADGIL Profile
SMITA GADGIL answered
Inventory is a list of goods and materials available in stock. Inventory management therefore is the procedure by which we manage the inventory to the best possible way so that we do not run out of stock.

Inventory management is actually keeping stock of the goods like spare parts, stationery, furniture, fixtures etc which are in the office. A ready stock of material required for running a facility smoothly is called Inventory management. There should never be a situation when the company has run out of a particular item. If this happens there would be panic in the office.

Inventory Management also entails that the items should be bought at lowest possible prices.

The inventory should be bought in bulk to avail of reduced prices, waste is reduced since the stocks are managed, category wise.

In a nutshell inventory management means managing the stocks in the office.

Every thing required should be available in a smooth fashion
Nothing should fall short in the office
best possible prices
eliminate waste
transportation of goods from one facility to another in a very seamless fashion

Inventory management is a very important aspect of business.


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