Importance Of Inventory Control

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Inventory control models Inventory control plays an important role in supply chain management. It involves balancing product availability with the cost of maintaining the inventory. Inability to match product availability and customer demand at a given time leads to either stock outs or extra inventory carrying costs. Some examples of inventory control systems and their practical application are - Material Requirements Planning - the methodology lies in planning for material according to the volume and calendar production schedule. Materials come into production based on the planned requirements but without the expressed demand. Inventory stock control is put into practice on the production line in such a way that there are always some inventory stocks for meeting production requirements. The main drawback of the MRP method is that enterprise keeps too large inventory stocks. Hence, this method can be used in cases of large quantities of low-value or class C materials and materials being processed relatively equally…show more content…
In queuing theory a model is constructed so that queue lengths and waiting time can be predicted. This theory can be adopted to develop a model for both manufacturing and service industries. The application of queuing theory in manufacturing industries having an assembly processes is to model the assembly process in the manufacturing plant by using an appropriate analytical model of Queuing Theory. Certain importance measures of this model will be derived and can serve as comparison with the standard data available in the company. The performance of queuing model will be determined as a guide to increase efficiency of each workstations and suggestion to increase the performance of each work station In the case of service industry, the queueing theory can be applied in the following areas with corresponding inputs and outputs – Situation Input
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