Question
Companies that sell products (not services) must carry inventory to meet demand from its customers. If the item is not in inventory the customer may
Companies that sell products (not services) must carry inventory to meet demand from its customers. If the item is not in inventory the customer may go elsewhere to source the item whether it is a raw material or final product. Carrying too much inventory can prove to be expensive however so companies spend a lot of time evaluating ______?
A. the demand for the product over the next period.
B. the costs associated with holding a sufficient amount of inventory - both financing, storage, transportation and other costs
C. the costs associated with not having enough inventory to satisfy customer demand.
D. the EOQ model or economic ordering quality model to determine the optimal amount of inventory to maintain.
E. all of the above.
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