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The vendor for our glass bottles is offering us a discount if we increase the number of bottles we order on a monthly basis. To
The vendor for our glass bottles is offering us a discount if we increase the number of bottles we order on a monthly basis. To take advantage of the discount we need to purchase a guaranteed minimum number of bottles each month for at least 1 year. The guaranteed minimum amount is more than what we currently order. While the amount of bottles that we use is steadily increasing but it has not yet reached the level of the minimum guarantee amount to take advantage of the discount. As it relates to the increase in inventory of bottles, what else should we be concerned about if decide to increase our inventory? Increasing our inventory will decrease our liquidity tying up funds in excess inventory We will incur an increase in expenses related to insurance, storage costs, and other inventory-related expenses. The risk of losses will increase due to price declines, obsolescence of inventory, or theft We should be concerned with all the above
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