A Case study on Champion electric Essay Example | Topics and Well Written Essays - 1000 words

A Case study on Champion electric - hear ExampleIn addition, the management declared that it already had profitable products, as well as lover decline. The extravagantly inventory levels accumulated pace for the piddy items that were necessary, yet the lodge did not have any. When a node ordered a product that was not available, the company had to re-order it, thus wasting a lot of beat for the customer. The balancing of too much inventory that whitethorn pull to high costs and few inventories that may comeback to loss of sales is the main concern for this management. Nevertheless, a firm holds inventory with an aim of trim down costs and in order to improve customer service. The management of champion electric is concerned with the look at of meeting customers demands, thus the need for high level of stocks. In this case, they will not loose knocked out(p)(p) on sale due to lack of a product. In addition, bulk buying reduces cost incurred as manufacturers grant a fare p rice for the bulk buying, hence a company is guaranteed of making dinero once it has bought goods at a fair price.However, some goods tend to be irrelevant, as they are remodeled by manufactures, thus, customers request for the latest model of a product. Moreover, Champion Electric lacks the latest products, as its records indicate virtually a 100% in stock. Barb is given the task of getting rid of the less purchased products in order to create space for new products. A dis emolument arises here, in that, a cost is incurred in terms of storage, and when these products become outdated, the company loses money. Nevertheless, high levels of inventory may mean higher sale if the products prices rise, and as well as decrease the risk of fall in generate in the future. According to Hobbs Dennis (p.59), high inventory levels lead to high overhead costs, the stock requires a lot of space, which leads to overhead costs therefore, it is important for Barb to enter inventory management. T he main fear of too high inventory is that it may yield to idle stock that is not purchased, which counts as a loss in any business, as the stock does not yield any returns. What would you suggest to Barb as steps to take in addressing the concerns of president Campos? The level of inventories is principally affected by demand, uncertainty, and the supply chain flexibility. Competitive advantage cannot be achieved by only high inventory levels however, the ability to manage supply chain is necessary. Effective inventory management ensures that a company maintains an ideal level of product as it acts as a key to attaining a competitive advantage for any business, such that, management and control of inventory may yield to customer satisfaction and lucrativeness of a firm (Toomey, p.1). First, Barb should collect accurate data on the number of inventories available in the store, which also involves keen observation on the number of stocks leaving and entering the stores. Accurate en tries on every stock receipts should also be considered however, though inventory management may seem expensive, it assists in monitoring the flow in and out of goods. Inventory management is important to any firm, in that, it influences supply and demand of a product. In the champion electric case, some customers demand for products which the company has run out of however, this may