Basics of Inventory Management for SMEs Part I

1. INVENTORY
MANAGEMENT
AL-TIJAARAT AL-RAABEHAH
PAKISTAN
PART I

2. 2
WHAT IS INVENTORY & ITS
MANAGEMENT?
1. Inventory or stock is the goods and materials that a
business holds for the ultimate goal of resale to
make money.
2. Inventory management or control is a discipline
primarily about specifying the shape and placement
of stocked goods.

3. 3
THREE MAIN ASPECTS
OPTIMUM LEVEL
CONTROL
PERFORMANCE
VALUATION

4. 4
MARATHON Q’s
HOW I CONTROL MY
INVENTORY?
FIRST…
DEAD STOCKS

5. 5
INVENTORY CONTROL
System that enables
Business to
Control
Inventory of Items
Never runs out
At optimal cost
Supply & Demand
Balance
WHAT TO ENSURE???
HOW TO ENSURE???
Adopting Technology

6. 6
INVENTORY CONTROL
ANOTHER ASPECT
Perishable Product
Deteriorates
Technological Product
Obsoletes
Adopt Technology
To Safeguard Against

7. 7
A – B – C ANALYSIS TECHNIQUE
CATEGORIES
A B C
H I M I L I
Control Constant Need
Based
Little
Value vs.
Volume
H I = Highly Important
M I = Moderately Important
L I = Least Important

8. 8
A – B – C ADVANTAGES
Smooth Flow
Cost Savings
(EOQ)
Control by
Exception
Work
Standardization

9. 9
JUST IN TIME TECHNIQUE
JIT
Little or No
Inventory
Pull-Based
System

10. 10
JIT ADVANTAGES
Low Inventory Cost
Low Warehousing Cost
No Wastage or Leakage Cost
Less Dead Stocks
Improved Cash Flows

11. 11
OTHER TECHNIQUES
MRP
EOQ MODEL
MINIMUM SAFETY STOCKS
VED ANALYSIS
FSN

12. 12
FINAL WORD…
WELCOME THE FUTURE OF
TECHNOLOGY

13. INVENTORY
MANAGEMENT
AL-TIJAARAT AL-RAABEHAH
PAKISTAN
PART II
NEXT

14. 14
ANY QUESTIONS
Q / A
?

15. 15
THANK
YOU