Which of the following is NOT a benefit of holding inventory?
A)It minimises order cost from placing multiple orders throughout the year.
B)It minimises risks involved in spoilage and obsolescence.
C)It can capitalise on seasonality in demand patterns.
D)It helps minimise the risk that the firm will not be able to obtain an input it needs for production.

Question

Quizplus · Accepted Answer

Holding inventory can provide benefits such as minimising order costs, capitalising on seasonality, and minimising the risk of not being able to obtain inputs. However, holding inventory also comes with costs such as storage and handling costs and the risk of spoilage and obsolescence. Therefore, option B is not a benefit, but a potential drawback of holding inventory.

Which of the Following Is NOT a Benefit of Holding