Inventory Management

• Inventory


  Raw materials, work-in-progress and finished goods held by a firm to enable production and meet customer demand
• Obsolescence risk


  The longer inventories are held, the greater is the risk that they will become obsolete (i.e. unusable or not capable of being sold)
• Inventory Control Charts


  maintain inventory levels to that the total costs of holding inventories is minimised
• Buffer stock


  An amount of inventory held as a contingency in case of unexpected orders in case of any delays from suppliers
• Lead time


  Amount of time between placing the order and receiving the inventory