Inventory Management - Definition
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What is Inventory Management?
Inventory, otherwise called stock, is the total list of goods, raw materials, finished products and other contents available in a company or store for sale. Inventory Management entails the way the inventory of a business are ordered, stored, arranged, counted, tracked, maintained, and sorted for sale. Inventory management is a element of supply chain management.
A Little More on What is Inventory Management
Inventory planning is a very important activity for all sizes of company. While small businesses do inventory management manually, large business employ the use of customized software such as ERP and SaaS for their inventory.
Just-in-Time (JIT) is a system used in inventory management. Using the JIT method means that a company will order and receive materials needed for sales or production per time. The order is based on production or sales schedule. They only keep stock of materials or goods needed for a particular sales period.
Materials Requirement Planning (MRP) is an inventory management technique used in calculating the materials needed to manufacture a product. It is based on sales-forecast which requires manufacturers depend on the accuracy of a sales record to accurately plan for inventory needs.
Academic Research on Alternative Inventory Control System (AICS)
- Inventory management over firm life cycle: some empirical evidence, Elsayed, K. (2014).International Journal of Services and Operations Management, 19(4), 431-450.
- Reliability Evaluation and Design of AICS: A Survey of Models and Experiments, Mohamed, A. A. M., Qureshi, M. A., & Behnezhad, A. R. (2005). Review of Accounting and Finance, 4(2), 59-85.
- An empirical analysis and stochastic modelling of aggregate demand behaviour in a spare parts inventory system, Wright, G. G. (1991). (Doctoral dissertation, City University London).
- Reexamining the relationship between inventory management and firm performance: An organizational life cycle perspective, Elsayed, K., & Wahba, H. (2016). Future Business Journal, 2(1), 65-80.
- Blood bank inventory control, Jennings, J. B. (1973). Management Science, 19(6), 637-645.
- Stock allocation among a central warehouse and identical regional warehouses in a particular push inventory control system, Jnsson, H., & SILVER, E. A. (1987). International Journal of Production Research, 25(2), 191-205
- Evaluating forecast performance in an inventory control system, Gardner, E. S. (1990). Management Science, 36(4), 490-499.
- Selecting the best periodic inventory control and demand forecasting methods for low demand items, Sani, B., & Kingsman, B. G. (1997). Journal of the Operational Research Society, 48(7), 700-713.
- Forecasting systems for production and inventory control, Fildes, R., & Beard, C. (1992). International Journal of Operations & Production Management, 12(5), 4-27.
- Alternative inventory and distribution policies of a food manufacturer, Mercer, A., & Tao, X. (1996). Journal of the Operational Research Society, 47(6), 755-765.
- Analysis and design of an adaptive minimum reasonable inventory control system, Towill, D. R., Evans, G. N., & Cheema, P. (1997). Production Planning & Control, 8(6), 545-557.