CONCEPTUAL FRAMEWORK OF INVETORY MANAGEMENT: A USEFUL GUIDE TOWARDS THE MAJOR ASPECTS OF THE SUBJECT

The term inventory refers to the stockpile of the products that a firm is offering for sale and the components that make up the products. Thus, inventory includes the stock of raw materials, goods-in-process, finished goods and stores and spares. Inventories have assumed colossal proportions in manufacturing organizations and a substantial amount of working capital is tied up in inventories. Industrialized countries have largely overcome the uncertainties by bringing in force regulating mechanism and have minimized transportation delays etc. and have substantially reduced the time lags and have reduced inventories as a result. There are countries to cite where organizations operate on zero inventory levels as they are certain about items that they have ordered will reach to the factory premises on time and date they were supposed to. However, it will still take time to have such mechanism in Indian settings and probably we are bound to have inventories till we ward off uncertainties as they did in advanced countries. The aim of the paper is to provide sufficient knowledge on the subject matter which will be helpful in understanding the subject well.An attempt has been made to summarize and present the theories, techniques and important concepts of inventory management.