inventory

management
Inventory Management

Purpose of inventory
Function of inventory
Classes of inventory
Inventory classification (ABC)
EOQ Models
Inventory Definition
Inventory is defined as “ those stocks or items
used to support production (raw material, WIP ),
supporting activities (maintenance repair and
operating suppliers) , and customer service
(finished goods and spare parts)
Inventory Management
“ Branch of business management , concerned
with planning and controlling inventories. “
Inventory Management Role
Inventory Management KPI
Inventory Policy
• It is a way of formalizing the results of strategic
inventory decision so that they can be
implemented consistently.
• It is developed considering following factors
▫ Customer demand
▫ Planning horizon
▫ Replenishment lead time
▫ Product variety
▫ Inventory costs
▫ Customer service requirement
 Bullwhip Effect

The bullwhip effect is a distribution channel phenomenon in which demand

forecasts yield supply chain inefficiencies. It refers to increasing swings in
inventory in response to shifts in consumer demand as one moves further up
the supply chain.
Thank you