Inventory plays a key role in Logistics Management . The inventories that are directly affected due to outbound logistics are ;_
----- Finished goods inventory
----- Pipeline inventory (Primary Transaction)
----- Warehousing inventory
----- Pipeline inventory (Secondary Transaction)
----- Retail inventory
The typical cost trade - offs between inventory an others decisions in Logistics would be :-
----- Inventory vs Transportation costs
----- Inventory vs Stock out costs
----- Inventory vs spoilage and material handling cost .
The purpose of warehousing is to arrange placement of products , provide storage facility , consolidate them with other and similar products , divide them into smaller quantities and to build up a required assortment of products . The necessities of providing warehousing are ;
----- To get continuous and uninterrupted supply in the market area .
----- To achieve full benefit of the economies in scale in transportation and production .
----- To satisfy time and place utility .
----- To meet the demand fluctuations of customer .
----- To tide over variations in supply .