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Inventory occupies a paradoxical position in modern business. On one hand, excessive inventory locks up working capital, increases storage and insurance costs, creates obsolescence and deterioration risks, and may conceal inefficiencies in purchasing and production. On the other hand, inadequate inventory can interrupt production, delay deliveries, cause stockouts, reduce customer satisfaction and ultimately paralyze supply chain operations. Therefore, inventory should not simply be regarded as waste or a “graveyard” of business resources; rather, it is a strategic asset that must be carefully balanced against operational requirements. A major strategic function of inventory is to ensure continuity of operations. Manufacturing firms require ________ ____ _______ ____ ________ _________ ________ ____.
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