Term
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Definition
| planning and controlling everything that affects creating, storing, and transporting products |
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Term
| Primary fuctions of inventory |
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Definition
| to have enough for demand and not lose profits while they are not available |
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Term
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Definition
| partially finished goods in various stages of completion |
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Term
| MRO (Maintenance, Repair, and Operating |
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Definition
| supplies used in operations but not part of finished goods |
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Term
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Definition
| inventory resulted from purchasing larger quantities than needed for immediate sale (normally high turnover products) |
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Term
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Definition
| costs to place an order/cost to prepare machines |
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Term
| Inventory-holding/carrying costs |
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Definition
| both are same: cost of storing inventory (price of units not being used) |
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Term
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Definition
| demand for a product SKU (individual product) which is unrelated to demand of other SKUs (individual products) |
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Term
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Definition
| demand of one product is directly related to demand of another ex, tires to a car |
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Term
| ABC inventory (80/20 rule or Pareto) |
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Definition
| used to check on-hand inventory and sales of each item: A items sell for a lot but few are sold ex, car 20% of product but 80% of profit, C items sell for low prices but in large numbers 80% of product but 20% of profit |
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Term
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Definition
| when inventory falls below a certain value, a new order is automatically placed, sometimes by using the "average demand during the lead time" |
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Term
| EOQ (Economic Order Quantity) Model |
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Definition
| determines order size to minimize annual total cost: setup costs + carrying costs, but must meet all 8 assumptions |
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Term
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Definition
| constantly checking inventory ex, 7-11 |
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Term
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Definition
| checking invnetory at specific points in time- higher chance of going out of stock, theft, etc |
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Term
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Definition
| all products go to a warehouse from suppliers to be separated and redistributed to various locations |
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