24. Glossary Flashcards
Inventory
Definition
Materials and goods held by a business and requried to allow for the produciton of products and their supply to the customer.
Inventory management
Definition
The process of ordering, storing, and using a company’s inventory.
Economic order quantity
Definition
The optimum or least-cost quantity of stock to re-order taking into account delivery costs and stock-holding costs
Buffer inventory
Definition
Minimum inventory level that should be held to ensure that continuous production is possiible should delivery delays occur or output increase.
Re-order quantity
Definition
Number of units ordered each time
Lead time
Definition
The time between ordering new supplies and their delivery
Re-order level
Definition
The level of inventory that triggers a new order to be sent to suppliers
Supply chain
Definition
The network of all businesses and activities involved in creating a product for sale, starting with delivery of raw materials and finishing with the delivery of the finished products.
Supply chain management
Definition
Handling the entire production flow of a product to minimise costs but improve customer service
just in time inventory management
Definition
avoid holding inventories by requiring supplies to arrive just as they are needed in production and completed products are produced to order.
Just in case inventory management
Definition
Aims to reduce risk of running out of inventory by holding high buffer inventory level.
