Common Inventory Related Problems. A Study on Manufacturing

International Journal of Research and Innovation in Applied Science (IJRIAS) | Volume VI, Issue IX, September 2021|ISSN 2454-6194

Common Inventory Related Problems. A Study on Manufacturing

Santhirasegaran Nadarajan, Kamarul Irwan bin Abdul Rahim, Ezanee Bin Mohamed Elias
School of Technology Management & Logistics, Universiti Utara Malaysia, Kedah. Malaysia

Abstract: The objective of this paper is to explore and reveal the most common inventory issues faced by industries particularly the manufacturing sector. Dealing with anticipated stock outs, surplus of stocks, abnormal stocks, inaccurate inventory data, replenishment issues, supplier’s commitment and poor forecasting.This paperadds value to the industrialist and practioners on the most remarkable issues pertaining to managing inventory especially addressing and dealing with the most common issues in the multinational company’s warehouse.

Keywords: Inventory management, Manufacturing, Stocks

I. INTRODUCTION

The lifeblood of business is getting the products to customers on time and in good condition. Thus, business needs a good inventory management system to achieve operational efficiency as to meet deliver the products on time and in condition. Inventory is a significant input in the activities of the supply chain of companies (Nadarajan, Chandren, Abdul Rahim, Radzuan, Mohd Nawi, 2018). Inventory is known as a physical asset of any materials or unsold items remaining at warehouse in order to meet production plans and to fulfill customer orders. An effective and efficient inventory managementhelps to meet sales demand, control the cost and generate revenue for the company (Nadarajan, et al., 2018). Basically, there is positive relationship between inventory and company profit (Chandren, Nadarajan, & Abdullah, 2015). In sum, a good inventory management enhances customer service, profitability and cashflow (Wild, 2017). However, managing inventory is a challenging task which requires full commitments of the companies. As matter of fact, the manufacturing industries do put lot of emphasize on managing inventory effectively and becomes part and parcel of the company to engage at all time to ensure sufficient inventory in meeting production plan and sales and also to eradicate any overstocking condition that may affect the business cash flow or the financial position of the company.In fact, the inventory management has positive association with firm performance (Elsayed, 2015). As for concerning the inventory management, there are three main types of inventory refer to Figure 1 require to focus on in implicating cost of having those inventories would likely affect the financial position of a company.

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