Inventory Management

INTRODUCTION Inventory to umteen small-scale business owners is one of the more than visible and tangible aspects of doing business. Raw materials, goods in process and destroyed goods all represent various forms of armoury. Each type represents cash tied up until the inventory leaves the company as purchased products. Likewise, sell agate lines in a retail store contri neverthelesse to net only when their sale puts money into the cash register. In a literal sense, inventory refers to stocks of anything necessary to do business. These stocks represent a large portion of the business investment and must be well managed in order to maximize profits. In fact, many small businesses cannot absorb the types of losses arising from poor inventory management. Unless inventories are controlled, they are unreliable, inefficient and costly. Inventory accounts for largest chunk in the working capital in any industrial enterprise. Inventory comprises of defenseless materials, work in progress, finished goods as well as loose overlyls and spare parts, including maintenance spares. All these need deployment of square(a) funds and for varying lengths of time. Consequently, the importance of inventory management as an integral part of the working capital management just now needs any emphasis.

SUCCESSFUL INVENTORY MANAGEMENT Successful inventory management involves balancing the be of inventory with the benefits of inventory. Many small business owners fail to appreciate fully the true costs of carrying inventory, which include not only direct costs of storage, indemnity and taxes, but also the cost of money tied up in inventory. This fine line between keeping likewise much inventory and not enough is not the passenger vehicles only concern. Others include: * Maintaining a wide assortment of stock -- but not spreading the rapidly moving ones too thin; * Increasing inventory turnover -- but not sacrificing the service level; * Keeping stock low -- but not sacrificing service or performance. *... If you want to get a full essay, order it on our website: Orderessay

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