THE IMPACT OF INVENTORY CONTROL TECHNIQUES ON PRODUCT LOSS REDUCTION AND FINANCIAL PERFORMANCE OF A FIRM.

THE IMPACT OF INVENTORY CONTROL TECHNIQUES ON PRODUCT LOSS REDUCTION AND FINANCIAL PERFORMANCE OF A FIRM.

Abstract:
Effective inventory control is crucial for businesses to maintain a competitive edge and optimize their financial performance. This study aims to explore the impact of inventory control techniques on product loss reduction and the overall financial performance of a firm.

The research methodology employed in this study involves a comprehensive review of relevant literature and the analysis of empirical data. The literature review examines various inventory control techniques such as just-in-time (JIT), economic order quantity (EOQ), and vendor-managed inventory (VMI). Additionally, it investigates the relationship between inventory control and product loss reduction as well as financial performance indicators such as profitability, liquidity, and asset turnover.

The findings suggest that implementing effective inventory control techniques can significantly reduce product losses within a firm. Techniques like JIT can minimize inventory carrying costs, reduce the risk of obsolescence, and prevent stockouts, thereby minimizing product losses. Similarly, EOQ helps in determining optimal order quantities, reducing holding costs, and minimizing excess inventory, ultimately leading to product loss reduction. VMI, on the other hand, facilitates better coordination between suppliers and buyers, ensuring timely replenishment and reducing stockouts and potential product losses.

Furthermore, the study reveals that improved inventory control positively impacts a firm’s financial performance. By reducing product losses, firms can enhance their profitability as well as asset turnover. Efficient inventory control techniques also contribute to better liquidity management by optimizing cash flow and reducing the amount of capital tied up in inventory.

Based on these findings, it is recommended that firms invest in advanced inventory control systems and techniques to minimize product losses and enhance financial performance. Companies should consider adopting a combination of JIT, EOQ, and VMI approaches tailored to their specific business needs and industry requirements.

In conclusion, this study highlights the importance of effective inventory control techniques in reducing product losses and improving the financial performance of a firm. By implementing appropriate inventory control measures, businesses can achieve cost savings, enhance profitability, optimize liquidity, and ultimately gain a competitive advantage in the marketplace.

THE IMPACT OF INVENTORY CONTROL TECHNIQUES ON PRODUCT LOSS REDUCTION AND FINANCIAL PERFORMANCE OF A FIRM. GET MORE PRODUCTION AND OPERATION MANAGEMENT PROJECT TOPICS AND MATERIALS

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