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4 Cards in this Set
- Front
- Back
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Describe the requirements for effective inventory management
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1. A system to keep track of the inventory on hand and on order. 2. A reliable forecast of demand that includes an indication of possible forecast error. 3. Knowledge of lead times and lead time variability 4. Reasonable estimates of inventory holding costs, ordering costs, and shortage costs. 5. A classification system for inventory items. |
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What is the Economic Order Quantity (EOQ) model?
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A basic mode used to find a fixed order quantity that will minimize total annual inventory costs
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What are the three types of EOQ? Which one is used for batch processing?
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Basic Economic Order Quantity Model Economic Production Quantity Quantity Discounts Model |
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What are the 4 inventory Costs?
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Holding (carrying) costs Ordering & Purchasing Costs Setup Costs Shortage Costs |
