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Inventory, in the sense of its use in an industry, implies stock of goods. These goods, however, can range from raw materials, maintenance materials, oils, fuel and lubricants to semi-finished and finished goods. They can be in solid, liquid as well as gaseous and are available for being used in production activities or for re-selling purposes. To help you understand the various practices of controlling the inventory, experts from myhomeworkhelp.com have come up to provide you the necessary guidance with Techniques of Inventory Control Assignment Help.
What are the important Techniques of Inventory Control?
Some of the essentials methods hinging on inventory control have been assimilated in the following fashion:
- Stock levels to be determined:
This action needs to be executed especially to tackle problems pertaining to understocking and overstocking. This necessitates finding out the minimum level, maximum level, average level and also danger level.
- Estimation of budget:
The firms which require a lot of materials for their production process should start calculating the costs for their purchases. A purchase budget would be a perfect head start for the job ahead. Also, there should be a separate budget for production, consumption and maintenance materials.
- Automation of inventory:
The automatic inventory system is a perpetual system as it inputs every detail on a particular item and also the value of its stock every time it is bought by the company. This aids in verification of the physical stock.
- Inventory Turnover Ratio:
This ratio is used for finding out that how quickly the inventory gets used up for the production process which facilitates the process of material management in a well-organized way. Comparisons of these ratios for different years can help in classifying the inventory as slow, dormant, obsolete or fast moving.
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