- Discuss the key considerations for each inventory management strategy (JIT, Warehousing, Overstocking, and Understocking).
JIT：Customer demand, production quality, delivery time
Warehousing：Whether the warehouse environment conditions are suitable for storing goods, and regularly inspect the goods
Overstocking：Determine demand, Mingrui captures market changes and costs
Under-stocking：Accurate demand forecasting, safety stock, and responsive supply chain management.
- Evaluate the potential benefits and drawbacks of each strategy in the context of the electronics retail industry.
JIT：Lower holding costs, reduced waste, and
Warehousing：Provides security and order processing efficiency but incurs holding costs.
Overstocking：This excess inventory may lead to higher holding costs, potential obsolescence, and cash flow constraints, but it also provides a buffer against unexpected demand surges
Under-stocking：One of the biggest consequences of insufficient inventory is customer dissatisfaction. Ultimately, although some customers may let a sold out item slip away, if your company is known for long-term inventory shortages, you may lose a lot of customer loyalty and repeat business. Attempting to quickly correct the problem is also dangerous. Urgent restocking requires a lot of money, and when you are unable to plan, you may miss out on potential discounts for bulk orders. All the costs of catching up have consumed your profits, and in the end, you may still exacerbate your customers.
Insufficient inventory also makes managing your inventory difficult. When you are always struggling to deal with stockouts, you can never truly handle the data needed for accurate predictions well. This is a cycle that is destined to continue.
- Provide a recommendation for the most appropriate inventory management strategy for the company, justifying your choice with reference to the analysis.
JIT：Exquisite production and strict product requirements, using JIT for time requirements
Warehousing：Products that are essential but have a relatively long shelf life can use Warehousing to ensure a stable and continuous supply of the product
Overstocking：Demand forecasting, regular inventory audits, and dynamic pricing.
Under-stocking：Accurate demand forecasting, safety stock, and responsive supply chain management.