Inventory Management - Subjective Questions

1. Discuss the impact of carrying excessive inventory on a company's financial performance and working capital requirements.
2. Explain the difference between the economic order quantity (EOQ) and reorder point (ROP) approaches in inventory management. When might each approach be more suitable?
3. Describe the concept of 'Just-In-Time' (JIT) inventory management. What are the potential advantages and challenges of implementing a JIT system?
4. Discuss the trade-off between holding costs and ordering costs in inventory management decisions. How can a company find the optimal balance?
5. Examine the role of technology, such as inventory management software and automation, in improving the efficiency and accuracy of inventory control.
6. In the context of inventory valuation methods, compare and contrast the First-In-First-Out (FIFO) and Last-In-First-Out (LIFO) methods. How does the choice of method impact financial statements?
7. Explain the concept of safety stock in inventory management. How does safety stock mitigate the risk of stockouts, and how can it affect a company's financial position?
8. Discuss the impact of demand variability on inventory management decisions. What strategies can companies employ to effectively manage inventory in the face of uncertain demand?
9. Describe the ABC analysis in inventory management and its relevance in allocating resources effectively to different categories of inventory. Provide examples of each inventory category.
10. Evaluate the financial and operational implications of the EOQ model when applied to perishable goods with a limited shelf life. How would the model need to be adjusted to accommodate such goods?