Running Head: INVENTORY MANAGEMENT Week 5 Assignment 5 Name Institutional Affiliation Date 1 INVENTORY MANAGEMENT 2 Inventory Management Inventory management is an approach used to source, store, and sell inventory. It can either be raw materials and/or finished goods. Inventory management means that a business has the right stock, in the right place, at the right time, and the right cost and price. It includes important aspects as overseeing and control of purchases from both customers and suppliers (Singh & Verma, 2018). Furthermore, it maintains the number of finished goods that are sold and fulfilling orders. Importance of Inventory Management For every production business, the value of inventory is very important and cannot be overstated or understated due to its importance in ensuring efficiency and longevity. Inventory management provides clear visibility which can help in reducing operation costs, providing better services, preventing loss such as theft, spoil, and returns and ultimately optimizing order fulfillment. Furthermore, it can give proper insight into an organization’s financial standing, purchasing behaviors of their consumers, opportunities, strengths, weaknesses, and future trends. Methods for Inventory Management There are varying methods of inventory management and may include; just-in-time inventory and the ABC inventory analysis. The just-in-time method is one of the most preferred inventory management approaches in the world. Its objective is ...
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