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Chirag Agrawal
Logistics and Data Analytics Expert
Asked a question last year

What is meaning of Inventory Control?

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Chirag Agrawal
Logistics and Data Analytics Expert

Inventory is not simply a “cost of doing business.” It directly affects a company’s profitability and the cost of goods sold. Business practices of lean manufacturing treat unsold inventory as a waste, to be eliminated where possible.

Inventory control is “the process of managing inventories in such a way as to minimize inventory costs, including both holding costs and potential out of stock costs,”

Inventory control is the process of keeping the right number of parts and products in stock to avoid shortages, overstocks, and other costly problems.

Inventory control focuses on cutting the number of slow-selling products a company purchases while also increasing the number of high-selling products. This saves businesses time and money because they don’t have to spend lots of man-hours reordering and receiving goods that they don’t really need. Plus, they avoid devoting precious warehouse space to hold those products, which cuts down on carrying costs and affords more room for faster-selling products.