Everything You Need To Know About Inventory Management
                     Everything You Need To 
Know About Inventory 
Management
Definition
As a piece of your store 
network, Inventory 
management incorporates 
viewpoints, for example, 
controlling and 
administering buys from 
providers just as client, 
keeping up the capacity of 
stock, controlling the 
measure of the item 
available to be purchased, 
and request satisfaction.
Retail and 
Wholesale:
Retail is the broadest catch-all term to depict 
business-to-buyer (B2C) selling. There are 
basically two kinds of retail isolated by how 
and where a deal happens. 
e.g: Online, Offline 
Wholesale, then again, alludes to business-to-
business (B2B) selling. Knowing the 
distinctions and best acts of retail and 
discount are basic to progress.
Importance:
Clear visibility about inventory helps you:
 Reduce costs
 Optimize fulfillment
 Provide better customer service
 Prevent loss from theft, spoilage, and returns
Stock keeping 
units:
Commonly known as SKUs.
These are item codes that you and others 
use to look and distinguish stock available 
from records, solicitations, or request 
structures. 
Setting up a straightforward framework 
for SKUs is significant in light of the fact 
that it's the principle way you'll 
distinguish and separate item variations; 
this additionally incorporates checking.
Third-party logistics 
(3PL):
Outsider coordination alludes to the 
utilization of an outer supplier to deal 
with part or the entirety of your 
warehousing, satisfaction, shipping, or 
some other stock related activity. 
Fourth-party coordination (4PL) makes 
this a stride further by overseeing assets, 
innovation, foundation, and full-scale 
store network answers for organizations.
EOQ:
EOQ is the ideal number of items you should buy to 
limit the complete expense of requesting or holding 
stock. 
Making sense of your EOQ can possibly spare you a lot 
of cash.
DIO:
Days stock exceptional (DIO), otherwise called days 
offer of stock (DSI), alludes to the number of days it 
takes for stock to transform into deals. 
The normal stock days exceptional shifts from industry 
to industry, yet for the most part, a lower DIO is liked.
Recorder Point 
Formula:
Determine your lead time demand in 
days
Calculate your safety stock in days
Sum your lead time demand and 
your safety stock
Safety stock formula:
safety stock acts as an emergency buffer you 
can break out when it looks like you’re on the 
verge of selling out. 
You want to have enough safety stock to meet 
demand, but not so much that increased 
carrying costs end up straining your finances.
Thanks!