Fewpal
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What are the advantages and disadvantages of maintenance of inventory?

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Advantages: 

  • Bulk production decreases costs of production, transportation, maintenance, etc. 
  • Instant/uninterrupted supply of goods to customers.
  • Inventory gives profit due to increase in market price. 
  • Inventory decreases the setup cost. 

Disadvantages: 

  • Ware house rent. 
  •  Interest on invested capital. 
  • Labour on maintenance of inventory. 
  • Maintenance of records. 
  • Loss due to fall in price, deterioration and depreciation, etc.

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