2.4.3 STOCK CONTROL

Question 1

procurement

Answer 1

the process of finding and buying goods from outside sources focusing on getting the best value through sourcing and negotiation

Question 2

lean production

Answer 2

manufacturing approach focused on minimizing waste and maximizing efficiency by streamlining processes and improving workflow

Question 3

just in case management (JIC)

Answer 3

where businesses keep higher stock levels to prepare for unexpected demand or supply disruptions. This ensures a buffer of inventory is available.

Question 4

just in time management (JIT)

Answer 4

inventory strategy that aims to reduce waste by receiving goods only as they are needed in production. This approach minimizes inventory costs and storage needs

Question 5

waste minimisation

Answer 5

process of reducing the amount of waste generated during production or operations, aiming to improve efficiency and decrease environmental impact.

Question 6

stock

Answer 6

refers to the inventory and materials a business holds for sale or production.

Question 7

stock control

Answer 7

process of managing and overseeing inventory levels to ensure that a business has the right amount of stock available to meet demand while minimising costs.

Question 8

buffer stock

Answer 8

extra inventory held to prevent stockouts and ensure a business can meet unexpected demand or supply chain disruptions.

Question 9

lead time

Answer 9

total time taken from placing an order for goods or services until they are received and ready for use

Question 10

advantages of JIT management

Answer 10

• minimizes the amount of stock held, lowering storage and holding costs.
• Less money is tied up in inventory
• Streamlined processes lead to faster production
• Focus on quality control reduces defects

Question 11

disadvantages of JIT management

Answer 11

• relies heavily on suppliers for timely deliveries
• Minimal inventory levels can lead to stockouts
• Reduced inventory means less protection against fluctuation
• if not managed well, JIT can lead to higher costs

Question 12

impact of JIT on supplier - business relationships

Answer 12

• encourages closer collaboration between businesses and suppliers
• Regular communication is essential for JIT, leading to better alignment on delivery schedules
• Businesses become more reliant on their suppliers for timely deliveries,
• JIT can lead to shared risks
• JIT emphasizes quality, prompting suppliers to maintain high standards

Question 13

types of companies that use JIT stock management

Answer 13

• manufacturing companies
• retailers
• food and bev industry
• e- commerce
• pharmaceutical companies
• textile and apparel industry