Literature Review On Inventory Management

Partially determined the types of inventories these companies currently manage; Partially described their essential inventory characteristics.

According to Investopedia (2014) dictionary, inventory represents one of the most important assets that most business possess, because the turnover of inventory represents one of the primary sources of revenue generation and subsequent earnings for the company’s shareholders/owners. There are several reasons for manufacturers to hold inventories: one is to meet the demand of production and sales operation; the other is to consider the market price. Generally, we would receive a lower price if we buy large stock of goods than a small amount of goods. However, overstocked inventories not only occupy plentiful funds, but also increase the costs including warehouse cost, insurance fee,

Then, inventory allows minimizing costs, it is speculative stock. For instance by exploiting economies of scale that may exist during both production and distribution. Or, when the supplier provides significant discounts for bulk purchases, storage can be useful too. Delivery costs will be reduced if lot sizes are large.

In this final paper for Managerial Finance I will attempt to show how the supply chain inventory management method can be affected depending on the situation of the retailer. Studying the control method for problems in inventory, which would include both, excesses in inventory as well as shortages, and hoping to minimize loss.

1. How does the cost of carrying inventory impact the traditional earning statement of the enterprise?

For a company the size of Smitheford Pharmaceutical inventory cost can be a large portion of the inventory value on hand. Inventory cost also known as ordering cost or carrying cost can be defined as the cost a company obtain to tore and maintain inventory over a certain time period ("Carrying

Setup Costs: costs to prepare a machine or process for manufacturing an order; may be highly correlated with setup time

Inventory counts will allow you to better manage stock levels, anticipate demand and prevent loss and theft. When tracking inventory, be sure to include maintenance items, equipment, furniture and any rentals. Because physical inventory counts are monotonous and laborious, consider dividing up the project into different sections or stages. For example, you can count by area or department. This will allow you to perform one part every day and reduce the burden on your employees. Be sure to regularly perform the inventory every quarter and use identical methodology and documentation. After a few years, you will be able to digitize this information into a spreadsheet to analyze past trends and make future

Inventory control is the biggest challenge because of inappropriate inventory management system. There is a requirement of proper food service for better inventory control and also for identifying the important requirements. There is a need to develop the inventory methods for the products and with a standard inventory management company should try to minimize the wastes in terms of future. (Gartenstein, 2012)

The tip of the inventory iceberg article by Sandeep Gupta and Charanyan Iyenger talks about root causes of hidden costs that retailers need to focus on so as to maximize their profits. One of the major root cause of hidden cost is the failure to manage inventory efficiently by retailers. These are not just inventory holding costs, but there is indirect cost that comes with inventory such as moving, handling, and storing inventory in the company or retailers site that directly affects profitability and productivity of the company.

Second, the classification in inventory management is still inaccurate. That results in some problems such as: the severe lack of some products which are in growing demand (1 inch valve series 230), the redundancy making storage expenses go up and the stagnancy in storage area (to products like gear driven rotary and monitor controller)

Nowadays, in an era that has advanced technology and a place in the world. Everything can be linked only at your fingertips in the times of rapidly developing with the sophisticated technology of today. Therefore, an inventory system is also not lagging behind in introducing a method of keeping an inventory data systematically and safely. The system plays a very important role in improving the competitiveness of a business. Usually, organizations today face too many challenges to achieve the cost, speed and reliability. Efficient inventory system really help in order to make sure the store’s performance and data record is always in good condition and secured from abusers. The system basically to ease the admin to manage the

Inventory management has two very different, but effective methods: Vendor managed inventory, and consignment inventory. A company may choose to utilize either of these two methods to manage inventory. If a company is able to manage inventory, they will be better able to work the company's capital to the fullest extent. The following paper will identify the differences between the two as well as identify what type of company is best suited for each method.

Managing what's in a warehouse or on the shop floor can be extremely complex if you're looking for optimal cost and supply chain management capabilities( Needleman, 2017 ). Inventory estimation and control is directly impacted a company’s profitability.

Inventory control is the processes employed to maximize a company's use of inventory. The goal of inventory control is to generate the maximum profit from the least amount of inventory investment without intruding upon customer satisfaction levels.