Q1) Below are the three crucial decisions to make regarding the creation and hol

Question

Q1) Below are the three crucial decisions to make regarding the creation and holding of inventory in a supply chain-

1. Hold inventory to meet fluctuations in demand to ensure customer service level is maintained and stockout costs are avoided.

2. Avoid holding inventory by chasing the demand through changing production for each period through hiring additional resources, subcontracting etc.

3. Maintain level production plan where the production is constant for each period which results in either stockouts or holding inventory depending on the demand.

Q2) The primary trade-off a supply chain manager needs to consider for inventory management is whether to hold inventory to meet fluctuating demand and incur holding costs or to not hold inventory and incur stockout costs due to the lost sales due to unmet demand.

Explanation / Answer

SCLT 3384 - Logistics Tech and Processes

Hello I need help in how to start an essay base on the question below, if any online resources were use please include them thank you in advance:

Explain the aspects regarding three crucial decisions to make regarding the creation and holding of inventory in a supply chain. Discuss the primary trade-off a supply chain manager needs to consider for inventory management.

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