The successful running of a business in which the company derives benefits and profits are called business management. It includes planning, organizing, controlling, monitoring and leading a business concern efficiently. Any business management student should need to lay stress upon all these aspects along with the importance of inventories on a business, in order to successfully complete his or her business management assignments. Help in business assignment writing in the UK can be properly found from BookMyEssay.

Every business needs some type of basic requirements of raw materials or inputs in order to produce finished goods or services. Keeping a record of these requirements or raw materials is called inventory. The dictionary meaning of inventory is ‘a complete list of items such as property, goods in stock, or the contents of a building’. Maintenance of inventory is a very important activity in any business, be it a trading company or a manufacturing unit. It may consist of materials that are either ready or will be ready for sale. It also includes work-in-process products and finished goods which will be a part of business assets. It is one of the most important assets of the business as the inventory turnover is the primary source of earnings for the business.

Types of Inventory

There are three types of Inventory

  • Of Raw materials: These represent the goods or substances which are used in the production of finished goods and products. These may include crude oil, metals, cloth, food items etc for refineries, industrial manufacturers, clothing manufacturers, food packaging industries respectively.
  • Of Work in progress products: These include those goods and items which are in process of transformation during the manufacturing process and are converted into finished goods or products. For example, a half-assembled car, truck, airplane or ship may be taken as the transformational product which will be completed in due time and said to be work in progress items.
  • Of Finished Goods: These are ready for sale products which have been through the process of completion and are said to be finished goods or products. These may include completed cars, trucks, airplanes or ships. Electronic goods, packaged foods, refined oils, ready to wear clothes, footwear etc can also be considered as finished goods.

Importance of Inventory

Managing inventory is very advantageous for the company. It may not be beneficial for a company to possess a large amount of inventory for a long time. This is because the cost of storage will be high and also there will be chances of damaging or spoiling of the goods. On the other hand, possessing very small inventory is also not beneficial because this creates a loss of customers and the position in the market will also be affected. So the importance of inventory management plays its role. It involves inventory management strategies and forecasts. A very suitable strategy will be JIT (just-in-time) inventory system. In this system, inventory costs are minimized as it works on the principle that goods are created or received only when needed.

Why keep inventory?

There are basically five reasons why we keep inventory.

  • Irregular Demand: Demand of goods and items depend upon the seasonal sales. As it varies periodically, the production remains fixed. The stock gets piled up in offseasons. The manufacturer has to sell out the overstock by giving huge discounts resulting in loss sometimes.
  • Time: It means that some amount of inventory has to be kept for use in lead time. This is due to the lag in supply chain system at that time.
  • Uncertainty: Sometimes there is an uncertainty in demand, supply, and movement of goods so some inventory has to be kept as buffer stock.
  • Economy: When the demand and supply are tailor-made, there is a huge cost of transportation. So one has to keep inventory to meet the irregularities in demand and supply.
  • Value Appreciation: Sometimes some stock has to be maintained in order to reach it to a certain maturity level e.g. wines kept in barrels for their maturing. So inventory is also needed for it.

Why Business Management Students Need Professional Help?

Business management students are given business management assignments to prove that they have learned something worthy. This not only helps them to get higher and good grades but also makes them competent enough to face the competition in the business market. They need to lay stress on one of the most important aspects of business management i.e. inventory. BookMyEssay, one of the leading brands in professional Business Management Assignments Writing Help may be their first choice when they are not able to complete their assignment satisfactorily. BookMyEssay.com has helped many students in completing their assignment writing within deadlines. The students not only achieve higher grades but also learn basics of business management. The assignments are of high quality and according to the standards required by the business school. The writers are highly experienced and well-versed with the needs of students as well as the business schools or the universities.