Question

what is inventory policy of momose business. why business man adopt inventory policy.what additional improvements he will make in inventory policy.

Answer 1

Answer:

The inventory policy of momose business is that the momose product to be produced and consumed on daily basis and the inventory will be planned such that the one day’s demand will be covered with the help of available inventory of the raw material required for the momose preparation. Thus the inventory of momose raw material will be sufficient to prepare the momose products for the one day’s demand. They will ensure that one day’s demand will be achieved with the help of the available inventory. Thus they will make the daily purchase of the raw material for the momose and do not keep inventory for more than one day’s demand.

Businessmen adopt inventory policy because the inventory policy will help the businessmen to plan their product’s manufacturing and they can fulfill their customer orders or demand with the help of the inventory policy. The inventory policy will be required to meet the customer demand or orders for the businessmen.

The additional improvements businessmen will make in inventory policy will be as below

• He will ensure that the inventory cost should not be high for the business and it should be as per strategy of the business.
• He will ensure that customer demands are not affected due to inventory policy and inventory policy should not limit the demand management for the customers.
• He will make the improvement for economic order quantity process so that he can explore the optimized approach for procurement, holding cost and inventory levels for the business.