Flashcards
Stock Control
Cards in this deck (12)
- 1What is the role of stock control?To ensure supply of raw materials for production
To ensure there are enough finished goods in order to meet demand - 2What does stock control involve?Ensuring there is enough stock for immediate needs whilst making sure you don't tie up your financial resources
- 3What does stock control enable you to do?Stock control enables: valuation, control of cash tied up in stock, control of waste and theft
- 4What is the level of stock influenced byChanges in demand e.g. if its sunny more people will want colder food and drinks
- 5What are the costs of having TOO MUCH stock?Costs of storage (including insurance and security etc.), handling costs, space (link to opportunity cost), fall in demand = unsold stock (waste), theft
- 6What is the cost of TOO LITTLE stock?Can't cope with demand meaning that customers could be lost, run out of stock, don't benefit from purchasing EOS.
- 7What can businesses implement to prevent stock holding costs?JIT
- 8What is JIT?It is a system that is part of production in which raw materials, WIP and finished goods are all delivered at the precise time they are needed - this totally eliminated the concept of stock.
- 9What process can you find which is part of JIT?Kanban
- 10What is Kanban?Kanban is a system created in Japan by Toyota and involves a signal being sent out e.g. from process D to C which lets that team know that they are ready to receive the goods. Kanban is essentially the trigger for more stock.
- 11Advantages of JIT-reduces stock
-no stock piles = less clutter
-avoids production of too many goods
-reduced wastage of stock
-more care can be spent over quality
-Overall cost reduction - less working capital required? - 12Disadvantages of JIT-Requires incredible communication
-If something goes wrong the process doesn't work
-dependence on suppliers is increased
-machine breakdowns = chaos - without buffer stock the system fails
-loss of purchasing EOS
-No guarantee of customers - or could have surges in demand etc.
-Not really a realistic process
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- Flashcards on Stock Control , created by sianmorris2 on 28/05/2015.
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- sianmorris2
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