Reasons for Having Inventories in Business Channels Include the Inability

question 10

True/False

Reasons for having inventories in business channels include the inability of business customers to predict their demand perfectly and operational problems in the logistics system that can cause stockouts.

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Definitions:

Insurance

A financial product sold by insurance companies to safeguard against financial risk and unforeseen losses.

Supply Chain Management

The actions the firm takes to coordinate the various flows within a supply chain.

Materials Management

The inbound movement and storage of materials in preparation for those materials to enter and flow through the manufacturing process.

Push Strategy

A supply chain strategy in which a company builds goods based on a sales forecast, puts those goods into storage, and waits for a customer to order the product.