The process of managing inventories to minimise both holding costs and potential stock-out costs is called inventory control.

Question

Quizplus · Accepted Answer

The statement is correct. Inventory control involves managing the level of inventories to optimize the balance between the costs of holding excess inventories and the potential costs of stock-outs, which occur when the inventory of a particular item is depleted and demand cannot be fulfilled. Effective inventory control can improve efficiency, reduce costs, and enhance customer satisfaction.

The Process of Managing Inventories to Minimise Both Holding Costs