Question

In: Operations Management

Your company manages about 500 stock-keeping units. Of this 25 of the items are very expensive...

Your company manages about 500 stock-keeping units. Of this 25 of the items are very expensive and require close control by operations personnel. These items most likely represent which type of inventory?

(Points : 3.03)

a. D
b.  C
c. B
d. A

Solutions

Expert Solution

The answer is d.

Reason : If these minority of stocked items need close control and are particularly expensive, then they should have a secure and well-monitored storage with frequent inventory checks in order to avoid losses. If the company chord to carry such items in their larger inventory there is a reason behind it, which is probably related to good revenue regarding the sales of these items, so keeping up with stock levels and reorders is a must when it comes to sales and proper stocking of A-items.


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