Managing stock (Edexcel GCSE Business): Flashcards
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Practise the cards
13 cards from this deck
Stock management definition
Stock management definition
Controlling materials & products for efficiency & effectiveness
3 types of stock businesses hold
3 types of stock businesses hold
Raw materials, work-in-progress items, finished goods
Maximum stock level
Maximum stock level
Highest amount of stock a business can or wants to hold
Re-order level
Re-order level
Stock level that triggers a new order
Minimum stock level (buffer stock)
Minimum stock level (buffer stock)
Lowest stock level maintained as a safety net
Pattern on stock level graphs
Pattern on stock level graphs
Saw-tooth pattern
Just in time (JIT) stock control
Just in time (JIT) stock control
Materials arrive exactly when needed for production
3 requirements for JIT to work
3 requirements for JIT to work
Strong supplier relationships, organised production, consistent demand
Holding stock benefit: demand flexibility
Holding stock benefit: demand flexibility
Unexpected demand increases can be met immediately
Holding stock benefit: bulk purchasing
Holding stock benefit: bulk purchasing
Cost advantages from supplier discounts
Minimal stock benefit: costs
Minimal stock benefit: costs
No expenses for storage facilities & stock management
Minimal stock benefit: risks
Minimal stock benefit: risks
Less chance of theft, damage, or obsolescence
Purpose of stock management
Purpose of stock management
Balance meeting demand whilst controlling inventory costs