A Study on Management and Inventory Control Strategies

A Study on Management and Inventory Control Strategies

Dr. Ravendra Kumar

Department of Mathematics, V R A L Govt Girls Degree College Bareilly

DOI: https://doi.org/10.51584/IJRIAS.2025.100800159

Received: 28 August 2025; Revised: 13 September 2025; Accepted: 16 September 2025; Published: 01 October 2025

ABSTRACT

The growth of an intellectual inventory management system is the focus of this idea. The system’s main goal is to bridge the wide gap between inventory management theory and practice and help industrial inventory managers manage their inventory effectively and successfully. Regular pattern recognition and model assortment facilities are two ways the proposed system aims to achieve this. In order to facilitate the function of the pattern identifier and integrate the system into the existing computer-based intellectual inventory management structure, a data administrator has been developed to load data from other applications into the system and influence the history data required for mathematical analysis. The swot up of inventory modelling and the nature and development of professional systems are examined in order to create the model base for the system. The published models that address comparable inventory issues have been assessed according to their suitability for computerization, simplicity, and applicability. To close the gaps in the model base, published models had to be further expanded and modified. It has been explained how the system was developed employing ocular essentials, as well as its general layout and key components. The cooperating companies provided real-world data for the systems testing. Finally, the system’s strengths and weaknesses are examined, and some recommendations for further research are listed.

Keywords: Inventory Control , Management , Model , Economical Order Quantity.

INTRODUCTION

The products or resources that a business uses for manufacturing and selling are referred to as inventory. The matter, which are useful materials to facilitate production, is also included. Work-in-progress, finished commodities, and raw resources are the three fundamental categories of inventory. Products that businesses buy to use in the manufacturing of final produced goods are known as raw materials. All goods that are presently in the production process are considered work-in-progress. In actuality, these items are partially man-made. Items that have already been shaped but have not yet been sold are referred to as finished goods. Inventory management is vital because it makes it possible to address the following crucial issues:

1. The company must have enough inventories to support its horizontal selling and production operations.
2. Neither too much nor too little should be invested in inventories. It ought to be the best. The primary goal of inventory management is to maintain the ideal level of inventory. To put it another way, inventory is made up of resources that will be used later on during regular business activities. The items that businesses keep on hand as inventory in case they become necessary are:
3. Raw resources.
4. Work in progression (Semi Finished goods).
5. Finished wares.
6. Stores and furnish.

Importance Of Inventory Management:

The following is a list of the implications or meanings of inventory management.

1. Inventory control facilitates the maintenance of a balance between ordering and transportation expenses, which.
2. Leads to a reduction in the overall cost of inventories.
3. Maintaining sufficient inventory for efficient production and sales is made easier by inventory management.
4. Activities Inventory control helps a business avoid the stock-out problem that would otherwise arise from the absence of
5. Appropriate inventory control. Inventory management advises a company to implement an appropriate inventory control system in order to prevent losses.
6. Compensation and misuses.

Difficulty announcement

In order to determine the company’s inventory performance and position, acknowledge its strengths and weaknesses, and evaluate its profitability, a SWOT analysis of inventory management is conducted. Inventories are the most significant component of the resources of the majority of Indian businesses. Inventory is a double-edged sword that can be an organization’s advantage or burden, depending on how it is used. Therefore, it is crucial to manage inventory in a creative and effective manner to avoid needless investment. and to determine what issues or difficulties the Inventory Management Process is facing.

Objectives

1. to research inventory control measures in inventory management using the instruments and methods of inventory management.
2. to research inventory management’s demand estimate. to research the application of aging schedules and ABC Analysis in inventory management
3. In inventory management, to ascertain the stock level. To recognize inventory management issues and determine appropriate solutions for them. To research inventory valuation techniques. To research the process of inventory management
4. To use the radio analysis technique to compare inventory management over the past five years.

LITERATURE REVIEW

The goal of the study is to evaluate the existing literature in order to comprehend the various firms’ inventory control procedures as well as the tactics and elements influencing inventory control success. Three theoretical frameworks served as the study’s guidelines:

Inventory control in theory and practice;

Application control theory; and Stock diffusion theory. Inventory modelling, decision support systems (DSS), and expert systems (ES) are the three key domains that are surveyed in the first three parts. The intelligent decision support system (IDSS), which combines the domains of ES and DSS, is then discussed. This section examines the knowledge-based or intelligent inventory systems that have been created recently. The study ends with a critical analysis. of the published systems for efficient inventory management. Harris created the first mathematical inventory model in 1913, which is commonly known as the Economic Order Quantity (EOQ) model. Raymond’s is the first full-length book that tries to show how different extensions of EOQ might be applied in real-world situations. Subsequent investigations revealed that the EOQ model seems to be rather insensitive to mistakes in demand estimation and the provision of the proper cost parameters. The EOQ model is significant not only from a historical perspective but also because it served as the foundation for numerous additional models created to address various circumstances. But at the time, there wasn’t much use for this inventory management mathematical modelling technique. Perhaps this was due to the fact that new ideas always require time to develop so that specifics can be refined and the initial assertion of enhanced performance and productivity can be validated over time.

Classifications:

1. The different reviewed papers were categorized into six groups based on the researchers’ common approaches:
2. Deterministic optimal inventory policy models.
3. Lot-size optimization models.
4. Models for optimizing different specific management goals.
5. Models for optimizing highly specialized inventory scenarios.
6. Applications of sophisticated mathematical theories, and Models that bridge the theory-practice divide.
7. Tinarelli’s survey made a significant contribution to the theory of inventory management by grouping the publications into six categories, which allowed the author to refer to them methodically:Perishables models Joint ordering systochastic models.dynamic demand models.volume and/or capital limitations. inventory control, and devaluation.

In an effort to encourage the use of published inventory models, some researchers have begun categorizing inventory systems to assist inventory managers in selecting the best model for a particular situation from the vast inventory literature.

Inventory Control System:

One of the most crucial factors in determining the business profile is an inventory. The management should decide how many units to keep on hand and when to order them in accordance with the requirements. Raw materials, work-in-process, and finished goods are the three categories of inventories.

Essentials Of Inventory Control System:

Keeping accurate records about the units and values of the various inventory items. To guarantee appropriate control over the materials’ receipt and distribution. Facilities should be stored properly, and materials should be appropriately identified.

Inventory Control Techniques:

Within the framework of one of the fundamental inventory models—the fixed order quantity system or the fixed order period system—the inventory control organization uses inventory control procedures.

The operational component of inventory management is represented by inventory control procedures, which aid in achieving the goals of inventory management and control. The following are the methods that are most frequently employed.

ABC analysis, always better control.

Analysis of fast, slow, and non-moving objects (FSN).

Quantity of Economic Order (EOQ).

Technique: Maximum-Minimum.

system of bin cards (KAN-BAN).

MRP stands for Materials Requirement Planning.

JIT stands for just in time. Analysis of VED

Abc Analysis:

ABC analysis is predicated on the Pareto principle, also known as the 80-20 rule, which states that 80% of the total consumption value (expense) is based on only 20% of the total items; in other words, a relatively large number of items may form a small part of the money value, while a small portion of the items may typically represent the bulk of the money value.

1. Items with the highest money value (70%) only make up 10% of the total.
2. things: constitute around 20% of items, with a middling 20% money worth. things in category
3. have the lowest 10% money worth, accounting for around 70% of all things.

Advantages of ABC Analysis:

Aids in exercising selective control over such kind of thing. Aids in exercising selective control over things that require a significant investment. Which have a substantial investment? Makes it easier to identify out-of-date stocks. Offers a solid foundation for allocating financial and human resources. It makes it possible to maintain a high rate of inventory turnover.

Disadvantages of ABC Analysis :

Only looks at an item’s monetary worth, ignoring how crucial it is to the assembly, production, or operation of the item. Because it doesn’t group the objects according to their essential requirements, ABC categorization’s goal may occasionally be undermined.

Fsn Analysis (Based On Turnover Ratio):

Not every item is needed as frequently in every manufacturing sector. While certain materials are needed frequently, others are needed infrequently, and some things may have become outdated and not been needed for years. According to FSN analysis, they fall into three categories: non-moving (dead stock), slow-moving, and fast-moving. The three categories must have distinct inventory models and policies. Since the items are sorted and examined based on their turnover ratios, it is necessary to compute each item’s turnover ratio while conducting this specific study.

Economic Order Quantity :

The order quantity that minimizes the overall expenses of ordering and keeping inventory is known as the economic order quantity, or EOQ. It is among the earliest forms of classical production scheduling. The Wilson EOQ Model, Wilson Formula, or Andler Formula are other names for the framework that is used to calculate this order quantity. Although Ford W. Harris created the model in 1913, credit for its thorough examination goes to K. Andler and R. H. Wilson, a consultant who used it extensively.

Kanban:

A scheduling method for lean and just-in-time (JIT) production is called kanban. Kanban is an inventory control technique that manages the supply chain from a production perspective. Toyota industrial engineer Taiichi Ohno created the Kanban method as a way to boost and sustain high production levels. One way to do JIT is by kanban. Kanban evolved become a great tool for encouraging improvement and supporting the overall operation of a manufacturing system. Reducing the amount of kanbans in circulation highlights problem regions. Setting a cap on the work-in-progress inventory helps prevent the manufacturing system from becoming overloaded, which is one of the key advantages of kanban.

Kanban cards :

A crucial part of kanban, kanban cards indicate when items need to be moved within a production facility or when products from an outside source need to be brought into the facility. In essence, the kanban card is a signal that indicates when inventories, parts, or products are running low. The kanban starts replenishing that product, part, or inventory as soon as it is received. Kanban cards assist build a demand-driven system since consumption drives the need for additional production, and the kanban card signifies the need for more product. Demand-driven systems, according to proponents of lean manufacturing and production, result in quicker production turnarounds and reduced inventory levels, making businesses that use them more competitive.

Material Requirements Planning :

A production planning, scheduling, and inventory control system called material requirements planning (MRP) is used to oversee industrial operations. Although MRP can be done manually, the majority of MRP systems are software-based. Three goals are expected to be concurrently achieved by an MRP system:

Make sure the items are ready for distribution to clients and that the supplies needed for manufacture are available.

Keep the store’s material and product levels as low as feasible. Plan the production process, the delivery timeline, and the procurement process.

Bill of materials processing, inventory control, and basic scheduling are among the fundamental features of an MRP system. MRP assists businesses in keeping their inventory levels low. It is employed in the planning of purchasing, delivery, and production operations. Below are a few examples: If a business buys the incorrect item or insufficient amounts of a manufacturing-related item, it may fail to fulfill contractual commitments to deliver goods on schedule. Money is squandered when a business buys too much of a certain item since it ties up cash and sits in stock, which may never be used at all. Customer deadlines may be missed if production of an order is started at the incorrect time. One tool to address these issues is MRP. It offers responses to a number of queries: What supplies are needed?

How many are necessary?

At what time are they needed?

MRP is applicable to both internally created sub-assemblies that are parts of more complicated things and those that are purchased from external suppliers.

Just-In-Time Manufacturing:

Reduced production flow times and supplier and customer reaction times are the main goals of just-in-time (JIT) manufacturing, sometimes referred to as just-in-time production or the Toyota production system (TPS). As evidenced by a number of books and compilations of case studies and articles from the 1980s, JIT moved to Western industry in the 1980s after being developed and primarily in Japan in the 1960s and 1970s, especially at Toyota. There, its features were implemented in numerous manufacturing companies However, the widespread use of JIT production in the 1980s quickly diminished in the 1990s as lean manufacturing emerged as “a more recent name for JIT.” The fact that Toyota Production System (TPS) has been and continues to be used as a synonym for both JIT and lean manufacturing is only one example of how similar the two phrases are.

Ved Analysis:

Unlike ABC classification, which is based on consumption value, VED (V-Vital, E-Essential, D-Desirable) classification is based on the criticality of the inventory.

Vital (V) The medications that are absolutely necessary for the patients’ survival must always be available at the hospital. Vital items (V) include things like oxygen that are essential to a healthcare facility’s operation and whose absence will significantly impair the organization’s ability to operate on a daily basis.

Essential (E):

Medications that may be offered in the hospital but have a lower critical necessity. Essential items (E) are those that are only temporarily unavailable or in short supply (such intravenous sets and fluids at a hospital), and if they are unavailable for longer than that, operations will be negatively and severely impacted.

Desirable (D):

The remaining medications are the least important, and their absence won’t have a negative impact on patients’ health. These are products (such vitamin E capsules or sunscreen creams at a hospital’s medical shop) whose shortage, even if it lasts for a long time, would not interfere with an organization’s regular operations X.

CONCLUSION

Regardless of the size of the organization, it is critical to recognize the importance of maintaining a healthy inventory. As managers, it is our responsibility to become knowledgeable about the concept of good inventory management and its applications.

1. Inventory management is one of the factors that contribute to a company’s demise. Failure can be fought in a variety of ways, and we can begin here. We can monitor and manage our inventories with the use of modern technology.
2. This article also examined the strategic significance of auditing practices and probabilistic selling strategies in inventory management, emphasizing their role in resource allocation adaptability.
3. We have the ability to learn, execute, and assess our business. Your inventory is a good place to start.
4. According to the analysis, taking into account a reasonable delay benefits the business financially and contributes to a sustainable environment. The results also showed that a high price does not always translate into a large profit.

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