INVENTORY MANAGEMENT: METHODS, APPROACHES, BENEFITS AND CHALLENGES

Authors: Ismail Mohammed Said Al Ruqeishi & Dr. Asad Ullah

ABSTRACT

Inventory control is a subdiscipline in the broad field of supply chain management, and it deals with the control of stock of items in a business. The information presented in this work is a synthesis of the current approaches to inventory management, along with the advantages and disadvantages concerning this issue. The main approaches to inventory control and management discovered in the literature review are JIT, EOQ, and ABC analysis. JIT focuses on manufacturing only as many units as are currently required avoiding pilferage along the predefined supply chain; EOQ on the other hand applies a theoretical balancing by identifying the most appropriate quantity to order to avoid high costs. ABC analysis helps to classify inventory by its value and level of priority to optimize resource distribution. The advantages of good stock management are great and include reduced holding costs, increase in cash flow from minimizing on stocks held, and customer satisfaction arising from the improved holding of stocks. But problems remain; demand forecasting is a challenge as is the handling of multiple inventory types, the costs and issues of applying new technologies for inventory management are also challenging. This specific review engages both peer-reviewed literature and the “grey” literature from leading databases and conference proceedings incorporating string search and snowballing technique for overall comprehensive understanding of the topic. The implications drawn from the research show the importance for managerial adaptation especially to business inventory that require optimization in efficiency as well as the utilization of technology to overcome the inherent flaws. This is why sustained research and development of materials concerning inventory management are critical to business operations in the context of a dynamic environment.

Keywords: Inventory, Management, Methods, Benefits and Challenges

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