Role of Inventory Control in Supply Chain Management

The list is available in the list series due to the lack of match between supply and demand. This discrepancy is deliberate on the steel manufacturer, where large scale construction is economical which is stored for future sales. Cale is deliberately at a retail store where the list is organized in anticipation of future demand. An important role in the supply chain is to increase the amount of demand played which can be satisfied by producing the product and available when the customer wants. Another important role-play plays is to reduce costs by exploiting any economics of the scale present during production and distribution.

Structures of Supply Chain Management: the supply chain is often depicted in the same network as the one displayed in Figure 1 below. Nodes in the network represent the features, which are linked to the links that represent the direct transport connection permitted by the company in the management of its supply chain (Shapiro, 2001). There are four levels of facilities in the network. Product flow downstream in markets from sellers, plants, distribution centers, and distribution centers. Generally, there may be arbitrary number of levels in a supply chain network. In some cases, the upstream flow of products may occur when plants are returned to intermediate products for resale or reusable products are returned to the distribution centers from the markets for recycling.

Issues to be Addressed: In essence, some issues should be resolved while trying to establish an effective system for stock and inventory management using retail software or any other system. Some basic issues like this should be addressed. Such as:

  • Type of management required for the particular enterprise.
  • Factors that influence the cost of inventory.
  • Whether it would be good keeping large inventories or it should be limited to specific size.

Pick into History: A little challenge in the history of inventory control can help to prepare strategies and plans for such purposes. During the early part of 1990, some food manufacturers formed a considerable consumer reaction by focusing on the cost of logistics in the investigation of supply chain. Along with this, skilled organization services became one of the focal points for these organizations. On the final analysis, the purpose of the new concept was to balance the list in such a way that it would not be too big or too little for the convenience of running the business.

Cale Villano

General Approaches in Inventory Control: Strongly, most business ventures use a general approach to inventory control. The process involves managing the inventory by objects. However, most enterprises use the system for production scheduling and purchase of raw materials. It is necessary that the system is also used for point-of-point locations and sale.

Inventory Use for Cost Reduction: Businessmen are often not involved in the active management of the list. The reason for this is that they know very well that any reduction in the list will be significantly removed from the cost of production, which is achieved with stable and actual list in hand.

However, it is necessary for each enterprise to properly adapt to changed environment and manage inventions in such a way that they not only benefit at production and supply points but also at point of sale. Perhaps the use of retail software may be an effective solution for the purpose.

Bi-level Optimization: Whenever a decentralized or hierarchical decision is required, a bi-level issue arises in real life situations. In these situations, many parties decide after the other, which affect their respective benefits.

So far, the only solution to solving two-level problems is through human methods for realistic sizes. However, efforts are being made to improve these optimal methods to calculate the optimal solution for real problems.

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