2.2.5 Impact of stock control Flashcards
1
Q
What are the problems of holding too much stock ?
A
- Wastage
- Costly
- Needing to storage extra stock
- Theft
- Occupies space in the premises
2
Q
What is Just In Time (JIT)
A
JIT helps negate the issues associated with holding too much stock by introducing the required suppliers at the moment they are needed
- No stock rooms, no issues with holding stock
3
Q
Advantages of JIT
A
- No wastage
- Parts are not warehoused: cost saving
- Less capital tied up stock: reduced average costs of production of each item
4
Q
Disadvantages of JIT
A
- The parts which are needed may not arrive on time- hold up
- Businesses: not cope with demand
- Will not gain discount for bulk purchase
- Higher admin costs as business needs to place more orders
5
Q
How will JIT impact suppliers?
A
- Stock has to arrive on time
- Fuel factors
- good relationship
- no buffer stock held in JIT system
6
Q
How will JIT impact employees?
A
- Admin paid higher
- Unexpected increase in work
- Varied hours
- Need training/ kaban system
- Apart of quality circle + encouraged to sort out problems
7
Q
What is lean production?
A
- It is an approach to management that focuses on cutting out waste, whilst ensuring quality
- Reducing labour, capital, time, space in the factory + raw materials
8
Q
Benefits of lean production?
A
- Reducing wastage; saving money
- Become more efficient, reducing time it takes to create product
- It would save wages
- Share holders benefit, don’t need a loan
- Paying for less premises
- Competitive advantage
9
Q
State two reasons why quality management is important?
A
- The product has good quality + less likely to have a mistake
- Generate a high level of repeat business so it will increase sales
10
Q
Give two marketing advantages to gaining a quality reputation?
A
- Product placement which attracts more costumer sales
- Quality brands may get more sales if there are a lot of advertising from celebrity advertisement
