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INVENTORY MANAGEMENT (Five costs in Inventory Management (b) Capital Costs…
INVENTORY MANAGEMENT
- Five costs in Inventory Management
b) Capital Costs
-Costs of investment, insurance costs, interest on working capital
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e) Risks Costs
- Damages and shrinkage costs
a) Ordering Costs
- Known as procurement costs, costs that are associated with the processing and chasing of purchase order, transportation,quality inspection and etc.
- Basics of Inventory Management.
a) Location
- on site, off site, drop ship.
b) Identity
- Stock Keeping Unit (SKU)
-I.D label
-Unit of measure
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- Three service classes in Inventory Management
b) Critical
- where the services or goods are quickly needed
-for instance, medical emergency
c)Non-critical
- Not necessary urgent but gives the benefits.
- For instance, computer
a) Schedule Delivery
- Should know the time for delivery, how many truck should load, and make sure the production line are managed effectively.
- Strategies to better manage inventories
b) Consider inventory optimization tools
- Best inventory policies for each product at each node in the supply chain.
- Typically stand-alone software tools that use data from WMS and ERP systems.
a) ABC analysis and ABC classification
- Fastest moving products in inventory should be located closest to the shipping staging and receiving area.
c) Automated Demand Forecasting
- Can be used to take the guesswork out of how much inventory should be carried for a given period
- Inventory Management
-Is the supervision of non-capitalized assets (inventory) and stock items. A component of SCM, inventory management supervises the flow of goods from manufacturers to warehouses and from these facilities to point of sale.
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