Inventory In Supply Chain Management Essay

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Supply chain management involves the movement of products, services, and information between and within businesses, the creation of value, and support of enterprises in the pursuance of a competitive advantage in the market place (Kilty, 2000). It involves the cooperation and coordination of activities of all parties for the production and distribution of products to the final consumer with mechanism in place to optimize inventories across the entire supply chain (Haan, et al., 2003; Viswanathan and Piplani, 2001). With effective management of products to create added value and competition among firms move from national to regional and to a global level, new strategies are being adopted by a number of manufacturers and retailers, particularly, in the…show more content…
In many cases, the concept of collaborative relationship has been considered the basic needs of supply chain management. However, supply chain relationships, particularly those involve in product flows, reveals that the heart of these relationships is inventory movement and storage. Most of the activity involved in managing relationships is based on the purchase, transfer, or management of inventory. Thus, inventory in supply chain plays a critical role because it is a salient focus of supply chains.
Perhaps the inventory play the most fundamental role in supply chains is to make it easier the balancing of demand and supply. In order promote and effectively manage the forward and reverse flows in the supply chain, company must deal with upstream supplier exchanges and downstream customer demands. This puts an organization in the position of trying to strike a balance between fulfilling the demands of customers, It is difficult to forecast precisely or accuracy, and maintaining adequate supply of materials and goods. This balance is often achieved through
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