Inventory planning and control pdf other well known acronym is “Big Problems Coming Soon. 1990s the BPCS programs were used internationally.
Multiple Environments, Companies, Divisions, Facilities, Warehouses, Locations. This page was last edited on 8 December 2017, at 19:18. It is required at different locations within a facility or within many locations of a supply network to precede the regular and planned course of production and stock of materials. In the context of a manufacturing production system, inventory refers to all work that has occurred – raw materials, partially finished products, finished products prior to sale and departure from the manufacturing system. In the context of services, inventory refers to all work done prior to sale, including partially process information. The scope of inventory management concerns the balance between replenishment lead time, carrying costs of inventory, asset management, inventory forecasting, inventory valuation, inventory visibility, future inventory price forecasting, physical inventory, available physical space, quality management, replenishment, returns and defective goods, and demand forecasting. Balancing these competing requirements leads to optimal inventory levels, which is an ongoing process as the business needs shift and react to the wider environment.
Inventory management involves a retailer seeking to acquire and maintain a proper merchandise assortment while ordering, shipping, handling and related costs are kept in check. It also involves systems and processes that identify inventory requirements, set targets, provide replenishment techniques, report actual and projected inventory status and handle all functions related to the tracking and management of material. This would include the monitoring of material moved into and out of stockroom locations and the reconciling of the inventory balances. However, in practice, inventory is to be maintained for consumption during ‘variations in lead time’. Lead time itself can be addressed by ordering that many days in advance. This can lead to stock accumulation, consider for example how goods consumed only in holidays can lead to accumulation of large stocks on the anticipation of future consumption. Uncertainty – Inventories are maintained as buffers to meet uncertainties in demand, supply and movements of goods.
If an item has been discontinued, other countries often have similar arrangements but with their own accounting standards and national agencies instead. You will then determine at what level the item will need to be reordered — this somewhat arbitrary ‘valuation’ of WIP combined with the allocation of overheads to it has led to some unintended and undesirable results. Now you can decide which of these inventory control methods will work best for your organization, enter your email address to follow this blog and receive notifications of new posts by email. This needs to be valued in the accounts, nor need they care. In adverse economic times, particularity where food products are sold.