What does “effective inventory management” mean?

Let us analyze this phrase in parts: stocks, management, efficiency.
Inventories (stocks – eng.) – these are the supplied raw materials, materials, components, work in progress from them, finished products, purchased goods, means of production and objects of labor stored in the enterprise. They are formed every time when incoming or outgoing material resources are not used at the enterprise, although they are available. A stock is a material flow that has stopped its movement, temporarily or permanently (forever). Without stocks, at least minimal, it is impossible to manufacture finished products, works, services, trade in goods is impossible. Therefore, any company has stocks in one or another quantity. Continue reading →