Question

Advantages and disadvantages of ved analysis

Answer 1

Explanation:

(i) Efficient inventory control methods can reduce but cannot eliminate business risk. (ii) The objectives of better sales through improved service to customer; reduction in inventories to reduce size of investment and reducing cost of production by smoother production operations are conflicting with each other

Answer 2

Advantages and disadvantages of VED analysis

Explanation:

VED stands for vital, essential and desirable. this analysis is used for classifying each stock( mainly spare parts) into above three category based on their requirement and stocked accordingly.

Advantages-

• It helps in classifying items into three category and stocked accordingly, for eg. vital items are stocked maximum. them essentials and least amount of desirable item is stocked.
• it brings economy in stock maintenance as each item need not to be stocked in abundance.

Disadvantages-

• this method is not suitable when thousands of items are used in production.
• Vital items are purchased in bulk and hence gets piled-up sometime and increases cost.

Learn more:

VED analysis meaning

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