THEORETICAL FRAMEWORK AND HYPOTHESIS DEVELOPMENT

According to Miller (2010), inventory management involves all activities

put in place to ensure that customer has the needed product or service.
It coordinates the purchasing, manufacturing, and distribution functions
to meet the marketing needs and organizational needs of availing the
product to the customers. Organizations from small to large businesses
can make use of inventory management to track their flow of goods.
( Sarah Amster) Also, effective inventory management is essential in the
operation of any business (Bassin 1990). Hakansson and Persson
(2004) identify three different trends in the development of logistics
solutions within the industry, one trend is concerned with the increased
integration of logistics activities beyond organization boundaries to
reduce cost items such as capital costs for inventory and handling costs
of flows.
According to Indeed editorial team ( 2021), supply shortages and
improper inventory management commonly cause stockouts. Another
stockout scenario is when a retailer has a product in stock in its
warehouse, but the item isn't available for purchase when the customer
wants it. Also, having enough inventory and the satisfaction of customers
is an important part of a retailer's business process. Preventing
stockouts can help a company make consistent profits and maintain
customer loyalty.
It is relevant to study because it tackles inventory management to
improve the stockout problem, which can help businesses to know how
important to manage the supply shortage and practice inventory.
The dependent variables of stock-out items are product shortages and
non-sustainability of sales, profits of the business, and the satisfied
customer. Inventory management impact is fundamental for a business
and its profitability. Monitoring and maintaining stock levels will enable
organizations to optimize the pricing strategy of products and the overall
revenue. Inventory management is vital to business success.
 The greater the extent of inventory management, the fewer the number of
stockout items.
 The effect of lack of supply can cause the sales, profit, and customer
satisfaction of the business mediated by inventory management.

INDEPENDENT VARIBLE DEPENDENT VARIBLE

Deficiency supply
product items
The factor that can affect
the weakness of
Business profits have
business is a lack of
dropped unsustainably
supply or stock-out

The sales of the business INVENTORY

is decrease MANAGEMENT

Customer satisfaction/
customer loyalty