Objectives of inventory management

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This will be very helpful for all supply chain professionals.


The objectives of Inventory Management:



1. To ensure continuous supply of materials spares and finished goods so that production should not suffer at any time and the customer’s demand should also be met.

2. To avoid both overstocking and under-stocking of inventory.

3. To maintain investment in inventories at the optimum level as required by the operational and sales activities.

4. To keep materials cost under control so that they contribute in reducing cost of production and overall cost.

5. To eliminate duplication in ordering or replenishing stocks.

6. To minimize losses through deterioration, pilferage, wastage and damages.

7. To design proper organisation for inventory management. Clear cut accountability should be fixed at various levels of the organisation.

8. To ensure perpetual inventory control so that materials shown in stock ledgers should be actually lying in the stores.

9. To ensure right quality goods at reasonable prices. Suitable quality standards will ensure proper quality stocks. The price analysis, the cost analysis and value analysis will ensure payment of proper prices.

10. To facilitate furnishing of data for short term and long term planning and control of inventory.

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