influences on inventory levels Flashcards
What are some INFLUENCES OF THE LEVELS OF INVENTORY HELD:
Production techniques (Ex the use of mass production or just in time)
Reliability of suppliers (if they are slightly unreliable, you’d probably want to hold a little bit more stock than necessary
Anticipated levels of demand (they could change throughout the year)
Level of finance a fix has available (they might want to free up capital stuck in stock)
What are some stock management techniques
Stock rotation - The process of bringing older stock to the front of displays (milk - new stock will be at the back of the shelf, and older stock which is closer to going out date will be put at the front of the shelf) - Could also prevent wastage in some cases
Reduction in waste - You can then invest the money that wasn’t wasted on goods on better security, to ensure that no one steels any goods - Or you could waste less time by having machinery make goods (makes sure that the quality is always to the correct standard)
Just in time production manufacturing - This will reduce wastage
