![]() Let’s say you’re the owner of a company that produces different parts for automobiles, and a client orders 10,000 airbags. Why is inventory management essential for any business? So now that you understand the basics of inventory management, let’s answer a vital question. Keep in mind that your business might not use all the types of inventory.įor instance, an e-commerce business that doesn’t produce its own goods might not need to include MRO supplies in the inventory. Finished goods: products that are ready for sale. ![]() MRO (Maintenance, Repair, and Operations) supplies: components that support the production process but aren’t necessarily part of it (e.g., gloves and security masks).Packing material: items used for product packaging (e.g., boxes used to ship products).Work-in-progress: unfinished products or products that aren’t yet ready for sale (e.g., products that need a final decoration or finish).Raw materials: items used to produce goods or intermediate materials and components (e.g., paper manufacturing companies use cellulose fibers derived from wood).The difference between them lies in the production stage they target. We can classify inventory management into 5 main categories. We’ll cover this in more depth, but first, let’s discuss the different types of inventory management and how they might help each area of your production process. Adding QR Codes to goods (you can generate one using one of these best QR code generators).Typically, inventory management involves: In short, inventory management helps you balance production, cash flow, and supply purchases with market demand to maximize your resources. Otherwise, your customers could find themselves receiving very late orders, or not receiving them at all. Inventories play a huge role in an organization’s supply chain, as they directly affect how products are sold and distributed.įor instance, if you can only store a certain number of products in your warehouse every month, it is important that you stay on top of incoming orders and outgoing supply. Inventory management is the practice of sourcing, storing, using, and optimizing an organization’s goods - i.e., merchandise, products, raw materials, etc.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |