Inventory control involves the procurement, care and disposition of materials. If a manager effectively controls the inventory, capital can be released (which may be tied up in unnecessary inventory), production control can be improved and can protect against obsolescence, deterioration and/or theft.
Companies use various techniques to decide how much inventory to order and when to order it. These may include techniques such as setting a re-order point (with/without buffer), by periodic review or a rolling schedule which are more quantity-based decisions.
Within this section we will review each method in a little more practical detail in order that you may be able to know when to use these techniques and how to use them.
