Explain what the current situation is, what problems are in evidence Essay

Explain what the current situation is, what problems are in evidence and how those problems should be addressed - Essay Example There are different inventory models and policies for single supplier and multiple suppliers and allied benefits as well as drawbacks for each of them which would be evaluated in the report. Certain recommendations related to purchasing and inventory functions would also be rendered so that the existing difficulties can be alleviated by a considerable extent. Table of Contents Executive Summary 2 Introduction 4 Conclusion 13 References 14 Introduction Inventory is defined as the stock of materials or any other item that is being used by an organisation. It is further defined as the idle resource of any kind that has a considerable economic value. It has been observed that inventories are supervised in order to meet the future demands of the process of production. The term ‘inventory management’ is regarded as the process of maintaining the finished goods, and the semi-finished raw materials of companies or any other business. It has been learnt that efficiently managed i nventory would result in an increase in the revenue by cutting down the cost of the company. The process of inventory management commences as soon as the company starts its production and orders the required raw materials for the same. In case of a retailer, the process commences as soon as it places an order to the wholesaler. ... faces certain difficulties in purchasing and managing inventories for the parts and materials of diverse brands for providing services to the customers. The Chief Executive Officer (CEO) of the company is concerned about the future requirements of vehicles parts and materials to meet the ever-increasing needs and demands of the customers. Based on the understanding of the case study, the report intends to illustrate the differences in inventory policies when there are multiple suppliers involved. The report would further discuss about the weaknesses in the current inventory management practices of Lancaster Motor Group and recommend appropriate measures to tackle the difficulties particularly related to purchasing and inventory function. Q.1. How Might Purchasing And Inventory Management Policies And Procedures Differ Because The Dealerships Purchase Different Types Of Service Parts And Materials (E.G. Lubricants Versus Genuine Parts) From Different Types Of Suppliers? Galena Markovi c was quite concerned about the future prospect of the company. She did not want the company to face the problem that other companies are facing with regard to managing the purchase of varied parts of automobiles in future. As it has been noticed that the company had a good reputation in terms of the deliverance of services, she became more concerned about its operations. For these reasons, she began thinking regarding supply chain and inventory management to resolve a bit of her concerns and pressures. However, as she is selling the product of four companies, she would have to buy the parts from various suppliers (i.e. multiple suppliers). In this regard, she would need to follow inventory policies different from that of the usual inventory management policy of single supplier. When a