Advantages and disadvantages of ved analysis
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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
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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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