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picture1_Slideshare Management 77199 | Ch12 Item Download 2022-09-03 00-38-03


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File: Slideshare Management 77199 | Ch12 Item Download 2022-09-03 00-38-03
learning objectives 2 discuss basic inventory principles describe inventory management objectives explain the relevant inventory costs explain the abc inventory classification model discuss inventory record accuracy calculate order quantities calculate ...

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                Learning Objectives
                                  2
     
       Discuss basic inventory principles.
     
       Describe inventory management objectives.
     
       Explain the relevant inventory costs.
     
       Explain the ABC inventory classification model.
     
       Discuss inventory record accuracy.
     
       Calculate order quantities.
     
       Calculate the appropriate safety stock level.
     
       Describe the periodic review approach.
                      Copyright © 2016 John Wiley & Sons, Inc.
                 Types of Inventory
                                 3
     
        Inventory comes in many shapes/sizes:
       Raw materials – purchased items or extracted materials 
         transformed into components or products
       Components – parts or subassemblies used in final product
       Work-in-process – items in process throughout the plant
       Finished goods – products sold to customers
       Distribution inventory – finished goods in the distribution 
         system
                     Copyright © 2016 John Wiley & Sons, Inc.
       Types of Inventory – cont’d
                          4
                 Copyright © 2016 John Wiley & Sons, Inc.
        How Manufacturers Use Inventory
                                   5
      1.  Anticipation or seasonal inventory (for future demand)
      2.  Fluctuation Inventory or Safety (or Reserve) Stock: 
          buffer demand fluctuations
      3.  Lot-size or cycle stock: take advantage of quantity 
          discounts or purchasing efficiencies
      4.  Transportation or Pipeline inventory
      5.  Speculative or hedge inventory protects against some 
          future event, e.g. labor strike, price increase
      6.  Maintenance, repair, and operating (MRO) inventories, 
          e.g. hand tools, lubricants, supplies
                      Copyright © 2016 John Wiley & Sons, Inc.
       Inventory in Service Organizations
                                 6
     
        Achieving good inventory control may require the 
       following:
        Select, train and discipline personnel
        Maintain tight control over incoming shipments
        Maintain tight control over outgoing shipments
                     Copyright © 2016 John Wiley & Sons, Inc.
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...Learning objectives discuss basic inventory principles describe management explain the relevant costs abc classification model record accuracy calculate order quantities appropriate safety stock level periodic review approach copyright john wiley sons inc types of comes in many shapes sizes raw materials purchased items or extracted transformed into components products parts subassemblies used final product work process throughout plant finished goods sold to customers distribution system cont d how manufacturers use anticipation seasonal for future demand fluctuation reserve buffer fluctuations lot size cycle take advantage quantity discounts purchasing efficiencies transportation pipeline speculative hedge protects against some event e g labor strike price increase maintenance repair and operating mro inventories hand tools lubricants supplies service organizations achieving good control may require following select train discipline personnel maintain tight over incoming shipments ou...

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