Competitiveness and Inventory Management or Safety Stock
To be competitive, many fast-food chains expanded their
menus to include a wider range of foods Although contributing to
competitiveness, this has added to the complexity of operations, including
inventory management In what ways did the expansion of menu offerings create a
problem for inventory management? One form of inventory is safety stock, which
is primarily carried by companies to ensure a variety of products is available
at all times However, safety stock ties up capital and hinders cash flow
As a manager, what recommendations could you provide to
reduce inventories as it relates to safety stock?
What parameters would lead you to believe that (a) large
safety stock, (b) small safety stock, and (c) zero safety stock would be
advantageous for the organization? Be sure to provide examples and data in
support
