Question

Better inventory management technology at major supermarket chains allows them to lower their cost of supplying goods to the market. True, False, or Uncertain: This cost reduction benefits producers (the supermarkets), but not consumers. Note: As we have recently observed, these changes to inventory management have made supermarket supply chains extremely susceptible to unexpected demand shocks.

Answer 1

Better inventory management will lead to tackling the uncertainty of the supply situations. if the products are safe in the inventory then there will be less costs for the producers from the fact that there will be no need of extra care/worry to keep the supplies intact.

example, if a supermarket installs a premium refrigerator facility to store milk then even today the milk is not sold they can store them for the next days to sell but if the facility weren't present there they would have to buy new milk for the next days to sell and there cost may go up in terms of price of the milk,the transportation cost and hassle cost .

hence the statement is true.

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