INVENTORY CONTROL AT WHEELED COACH AMBULANCE

Name :Name of Professor :Subject :Date :Wheeled Coach Ambulance Inventory management is defined by the American Production and Inventory Society (APICS ) as the “branch of business management concerned with planning and controlling inventories (Toomey , 1 . The purpose for inventory management is to keep a needed stock level of particular products or items . Inventory management is important in the Wheeled Coach Ambulance because half of its sales revenues are used or spent on purchases . There are more than 70 ,00 SKUs which are supplied by vendors resulting to frequent reorders . Consequently , there is a crucial need for safety stocks in the Wheeled Coach Ambulance . In addition to this , Wheeled Coach Ambulance offers delivery within 19 days of fully customized goods . Therefore , the company could not afford to go short . In order to improve the classification of inventory , consequently resulting to better management , ABC analysis is employed . In the Wheeled Coach Ambulance , they divide the raw materials by correlating volume with monetary value (Chiste , 208 . The materials classified as class “A ‘ are , chassis from Ford , aluminium from Reynolds Metal as well as the plywood ordered by local suppliers to be used for flooring and cabinetry . The materials classified as class “B ‘ are electrical wirings while those classified as class “C ‘ are the small parts , such as rivets . Through the implementation of the ABC analysis or classification , the Wheeled Coach Ambulance is able to carefully increase and supervise class “A ‘ suppliers . In addition to this , there is better precision when it comes to estimating class “A ‘ materials , due to the utilization of a more refined technique . Lastly , with ABC analysis or classification , there is physically tighter control or management of class “A ‘ materials .Part of the control of inventory items at Wheeled Coach is cycle counting . Under cycle counting , “A ‘ items are counted on a very short cycle , perhaps once a month to verify transaction accuracy . “B ‘ items are counted less frequently , perhaps every two months . And “C ‘ items are verified once a quarter or even less frequently . Cycle counting provides a much more effective auditing procedure than periodic (annual )counts of inventory .Effective auditing procedures , as well as accurate inventory records ,are crucial for any organization in attaining its highest level of performance . This is due to the fact that many significant assessments are created based on reported inventory balances . The inventory balances serve as the basis for creating long-term strategic decisions and the daily operational decisions . If there is inaccuracy in the inventory balances , it is most likely that there are production delays or missed deliveries (Maynard and Zandin , 10 .97 . Moreover , there will be inventory overages , resulting from errors in the inventory balances .These inventory overages use resources , space and money that could better be used for something else . The Wheeled Coach Ambulance promises its clients goods based on inventory balances , both current and expected . The promises to the clients might not be kept if the reported inventory balances are incorrect . Consequently , this would result in lost sales , lost customers…

Tags of essay "INVENTORY CONTROL AT WHEELED COACH AMBULANCE ": , , , , , , , , , ,