Illustrate the examples of the inventory control systems?
Examples of inventory control systems
Reorder level systems:
- When the current stock level decreased below a standard reorder level, than a latest order is placed for a fixed amount within order to replenish stock Periodic review systems,
- There is a fixed quantity is ordered for variable intervals of time.
Periodic review systems:
- All stock levels are reviewed at pre-found intervals of time for example, first day of each month. All orders for stock will be placed after a review.
- A variable or fixed quantity is ordered at a fixed interval of time.
Economic order quantity (EOQ):
- This model determines a fixed quantity of stock to order that would minimise the total of ordering and holding cost.
- A fixed quantity is ordered here for variable intervals of time.
ABC system:
- Higher value elements are reviewed more often and controlled through a greater extent than low value items.