2.4.3 Stock Control

What is the definition of stock control?

Stock control is the control of the flow of stock in a business, concerning the ordering and management of raw materials, components, work-in-progress, and finished goods.

What are buffer stocks?

Buffer stocks are stocks held in case there is an unforeseen rise in demand or a problem with supply, ensuring that production is not stopped.

List the seven deadly wastes in lean production.

1. Over production 2. Waiting time 3. Transportation time 4. Excess processing 5. Excess stock 6. Excess motion 7. Product quality.

What does JIT stand for in inventory management?

JIT stands for Just-In-Time, a management system where stock is delivered as needed, minimizing inventory costs.

Explain the implications of poor stock control.

Poor stock control can lead to stock out costs, loss of customer goodwill, loss of sales revenue, damage to reputation, and disruption to production.

What is the purpose of a sales forecast?

The purpose of a sales forecast is to predict future sales, enabling businesses to plan inventory levels and resource allocation effectively.

What is a zero based budget?

A zero based budget is a budgeting method where all expenses must be justified for each new period, starting from a 'zero base'.

Identify a limitation of cash-flow forecasting.

One limitation of cash-flow forecasting is that it relies on estimates, which can be inaccurate, leading to potential mismanagement of finances.

What is the maximum stock level?

The maximum stock level is the highest amount of inventory that a business can hold before it becomes costly.

What are the advantages of holding buffer stocks?

Advantages of holding buffer stocks include the ability to respond quickly to changes in consumer demand and to avoid production disruptions due to supply issues.