about: business inventory
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Inventory is a list for goods and materials, or those goods and materials themselves, held available in stock by a business. It is also used for a list of the contents of a household and for a list for testamentary purposes of the possessions of someone who has died. In accounting inventory is considered an asset.
Origins of the word Inventory
The word inventory was first recorded in 1601. The French term inventaire, or "detailed list of goods," dates back to 1415. Inventory management is primarily about specifying the size and placement of stocked goods. Inventory management is required at different locations within a facility or within multiple locations of a supply network to protect the regular and planned course of production against the random disturbance of running out of materials or goods. The scope of inventory management also concerns the fine lines between replenishment lead time, carrying costs of inventory, asset management, inventory forecasting, inventory valuation, inventory visibility, future inventory price forecasting, physical inventory, available physical space for inventory, quality management, replenishment, returns and defective goods and demand forecasting.
Other definitions of inventory management from across the web:
Involves a retailer seeking to acquire and maintain a proper merchandise assortment while ordering, shipping, handling, and related costs are kept in check.
Systems and processes that identify inventory requirements, set targets, provide replenishment techniques and report actual and projected inventory status.
Handles all functions related to the tracking and management of material. This would include the monitoring of material moved into and out of stockroom locations and the reconciling of the inventory balances. Also may include ABC analysis, lot tracking, cycle counting support etc.
Management of the inventories, with the primary objective of determining.controlling stock levels within the physical distribution function to balance the need for product availability against the need for minimizing stock holding and handling costs.
In business management, inventory consists of a list of goods and materials held available in stock.
An inventory can also be a self examination, a moral inventory.
Labels: Inventory Management, Procurement, Supply Chain, Supply Chain Management
The reasons for keeping stock
There are three basic reasons for keeping an inventory:
- Time - The time lags present in the supply chain, from supplier to user at every stage, requires that you maintain certain amount of inventory to use in this "lead time"
- Uncertainty - Inventories are maintained as buffers to meet uncertainties in demand, supply and movements of goods.
- Economies of scale - Ideal condition of "one unit at a time at a place where user needs it, when he needs it" principle tends to incur lots of costs in terms of logistics. So bulk buying, movement and storing brings in economies of scale, thus inventory.

























