INVENTORY MANAGEMENT

Learning Objectives

• Explain the different purposes for keeping inventory.
• Understand that the type of inventory system logic that is appropriate for an item depends on the type of demand for that item.
• Calculate the appropriateness Wheatstone-time purchase must be made.
• Describe what the economic order quantity is and how to calculate it.
  
• Summarize fxed–order quantity and fxed–time period models, including ways to determine safety stock when there is variability in demand.
• Discuss why inventory turn is directly related to order quantity and safety stock.