Category: Inventory Management

Just-In-Time (JIT) is a manufacturing and inventory management philosophy that aims to produce and deliver goods or services at the exact moment they are needed in the production process or by the customer. The goal of JIT is to minimize inventory levels, reduce carrying costs, and eliminate waste, while ensuring that production remains efficient and […]

ABC analysis, also known as Pareto analysis or the 80/20 rule, is a widely used inventory management technique that categorizes items based on their relative importance in terms of value or frequency of consumption. It helps organizations prioritize their inventory management efforts and allocate resources more efficiently. The analysis derives its name from the three […]

Inventory management refers to the process of efficiently and effectively overseeing the acquisition, storage, tracking, and utilization (ASTU) of an organization’s goods or products. It involves maintaining the right quantity of items at the right time (RQ@RT) to meet customer demands while avoiding overstocking or stockouts. The primary objectives of inventory management are to: Ensure […]

Forecasting Models – Forecasting models are one of the many tools businesses use to predict outcomes regarding sales, supply and demand, consumer behavior and more. Four common types of forecasting models Time series model Econometric model Judgmental forecasting model The Delphi method Time series model This type of model uses historical data as the key […]

Safety stock describe a level of extra stock that is maintained to mitigate risk of stock-outs. It acts as a buffer stock in case sales are greater than planned and/or the supplier take more time to deliver ordered units than its average lead time. where, α is the service level, Zα =1.65 for 95% service level. E(L) […]