Question

Distinguish between over-inventory and under-inventory with reference to their consequence in detail.

27 Apr 2023
Answer :
Word Count : 327

Over-inventory and under-inventory are two inventory management issues that businesses commonly encounter. Both issues can have significant consequences for a business's operations and bottom line.

Over-inventory occurs when a business holds more inventory than it needs to meet customer demand. This can be due to a variety of factors, such as overestimating demand, ordering too much inventory, or slow sales. The consequences of over-inventory include:

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