Term
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Definition
| The stock of any item or resource used in an organization. |
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Term
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Definition
| The demands for various items are unrelated to each other. |
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Term
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Definition
| The need for any one item is a direct result of the need for some other item, usually an item of which it is a part. |
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| Fixed–order quantity model (or Q-model) |
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Definition
| An inventory control model where the amount requisitioned is fixed and the actual ordering is triggered by inventory dropping to a specified level of inventory. |
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Term
| Fixed–time period model (or P-model) |
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Definition
| An inventory control model that specifies inventory is ordered at the end of a predetermined time period. The interval of time between orders is fixed and the order quantity varies. |
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Term
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Definition
| The amount on-hand plus on-order minus backordered quantities. In the case where inventory has been allocated for special purposes, the inventory position is reduced by these allocated amounts. |
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Definition
| The amount of inventory carried in addition to the expected demand. |
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Term
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Definition
| A physical inventory-taking technique in which inventory is counted on a frequent basis rather than once or twice a year. |
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Term
| customer order decoupling point |
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Definition
| a point where inventory is positioned to allow processes or entities in the supply chain to operate independently |
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Term
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Definition
| used when we are making a one-time purchase of an item |
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Term
| Fixed-order quantity model |
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Definition
| used when we want to maintain an item "in-stock," and when we resupply the item, a certain number of units must be ordered each time |
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Term
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Definition
| used when the item should be in-stock and ready to use. item is ordered at certain intervals of time |
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Term
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Definition
| the set of policies and controls that monitor levels of inventory and determine what levels should be maintained, when stock should be replenished, and ow large orders should be |
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Term
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Definition
| generally refers to items that contribute to or become part of a firm's product output |
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Term
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Definition
| To maintain independence of operations, to meet variation in product demand, to allow flexibility in production scheduling, to provide a safeguard for variation in raw material delivery time, to take advantage of economic purchase order size |
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Term
| Holding (or carrying) Costs |
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Definition
| cost for storage facilities, handling, insurance, pilferage, breakage, obsolescence, depreciation, taxes, and the opportunity cost of capital |
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Term
| Setup (or production change) costs |
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Definition
| to make each different product involves obtaining the necessary materials, arranging specific equipment setups, filling out the required papers, appropriately charging time and materials, and moving out the previous stock of material |
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Term
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Definition
| costs taht refer to the managerial and clerical costs to prepare the purchase or production order |
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Term
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Definition
| when the stock of an item is depleted, an order for that item must either wait until the stock is replenished or be canceled |
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