Question

What do you mean by inventory control. explain its advantages?

Answer 1

Coordination & supervision of the supply storage, distribution, & recording of material to maintain quantities adequate for current needs without excessive over supply or loss.

Answer 2

Inventory control refers to the regulation and maximization of stock maintained by a company. It is done in order to meet the demands of the consumers without any delay or problem keeping in view the minimization of costs associated with holding of stock.

The advantages of inventory control are:

1. Customer Service: The customer service levels will increase if there are working inventory control policies. This helps in increasing the reputation of the business. If customers find it easy to get their products from you then they wont go to any other competitor and sales will increase as well as customer relationships.

2. Labor Cost: High-level inventory control policies can help decrease the labor costs associated with managing the inventory. Labor costs increases as labor is used to move inventory from one place to another so inventory control ensures that this usage of labor is minimized.

3. Inventory Costs: Inventory costs are lowered due to efficient inventory control. Inventory carrying costs consist of all the expenses a company encounters for owning inventory. Effective inventory control helps to reduce storage costs, because it orders enough inventory to fill consumer demand and not more than that.