Business Studies (AS)·Production management · NSSCAS 3.6
Inventory management
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Every bag of cement sitting in a storeroom is money a business has already spent — but an empty shelf loses the sale. In this lesson you learn to weigh the costs of holding inventory against the benefits, and to draw and read the inventory control chart with its maximum level, reorder level, buffer inventory and lead time. You will calculate a reorder level, analyse what happens when a supplier turns slow, and evaluate Just In Time against just-in-case in a real Namibian setting. Examiners ask you to compile the chart, calculate from it and then judge — so we practise all three.
What you'll learn in this lesson
By the end you should be able to (NSSCAS Business Studies (AS) 3.6):
- discuss costs and benefits of holding inventory
- compile and analyse simple inventory control charts
- evaluate buffer inventory, reorder level and lead-time in a business
- discuss inventory control methods including buffer inventory and Just In Time (JIT)
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