Operations Management: Sustainability and Supply Chain Management - Chapter 12 Inventory Management

A set of vocabulary flashcards covering key concepts from Chapter 12 on Inventory Management in Operations Management.

Inventory Management

The process of overseeing and controlling the ordering, storage, and use of inventory.

ABC Analysis

A method of classifying inventory into three categories (A, B, C) based on annual dollar volume.

Safety Stock

Extra inventory held to prevent stockouts due to uncertainties in demand or supply.

Economic Order Quantity (EOQ)

A formula used to determine the optimal order quantity that minimizes total inventory costs.

Fixed-Period (P) System

A system where inventory is reviewed and orders are placed at fixed intervals.

Production Order Quantity Model

A model used when inventory builds up over time as products are manufactured.

Reorder Point (ROP)

The inventory level at which a new order should be placed to replenish stock.

Cycle Counting

An inventory auditing procedure, where a subset of inventory is counted on a specific day.

Holding Costs

Costs associated with storing and maintaining inventory over time.

Probabilistic Models

Models used when demand is uncertain to analyze inventory levels and service levels.