Question 1

What is the importance of inventory auditing in supply chain management?

Accepted Answer

Inventory auditing is crucial in supply chain management as it helps identify discrepancies between recorded and actual stock levels, ensuring accuracy in inventory records, minimising losses, and improving overall operational efficiency.

Question 2

How often should businesses conduct stock audits?

Accepted Answer

Businesses should conduct stock audits regularly, with the frequency depending on the size and nature of the inventory. Monthly, quarterly, or annual audits are common practices, but more frequent checks may be necessary for high-turnover items.

Question 3

What are key performance indicators (KPIs) for inventory management?

Accepted Answer

Key performance indicators for inventory management include inventory turnover ratio, stock-out rate, carrying cost of inventory, and order accuracy, which help businesses assess their inventory efficiency and make informed decisions.

Question 4

How has e-commerce affected inventory management strategies?

Accepted Answer

E-commerce has greatly influenced inventory management strategies by increasing the complexity of stock levels, necessitating real-time inventory tracking, and requiring businesses to adapt to higher customer expectations for order fulfilment and delivery speed.

Question 5

What are some best practices for optimising inventory management in a supply chain?

Accepted Answer

Best practices for optimising inventory management include implementing regular stock audits, utilising inventory management software, establishing clear inventory KPIs, and adapting inventory strategies to align with market demand and sales channels.

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