A Mexican firm, Recos Cementos, produces and distributes cement and concrete in bulk and bagged forms for the construction market. Inventory is maintained in nine terminals for serving customers (contractors) throughout the country. A graph of the average inventory level in a terminal vs. the annual shipments from the terminal for each of the nine terminals is shown in Figure 9-24.
What can you say to the company about its inventory management performance and opportunities?

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6000 4000 2000 0 200000 300000 400000500000 Period facility throughput, S Figure 9-24 A Plot of Average Inventory Against Annual Terminal Shipments