Business Management Dynamics

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ISSN: 2047-7031

bmd Business and Management Dynamics bmd
ISSN: 2047-7031  
Volume  2   Issue 10  2013  
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Article Abstract
The Impact of Inventory Inaccuracy in the Food Manufacturing Industry: A Case Study
Keywords:  Inventory management, inventory inaccuracy, record accuracy, cycle counting, food manufacturing industry
Thanasak Ruankaew, PhD and Patricia Williams
Inventory is one of the most important assets of an organization. In many industries, recorded inventory does not always match physical inventory. Inventory inaccuracy can negatively impact an organization's financial strength, customer satisfaction, and competitive advantage. Accordingly, the purpose of this study was to investigate the impact of inventory inaccuracy in the food manufacturing industry. Data collection was conducted by observing the inventory management process and interviewing inventory management associates at food manufacturing plants in Pennsylvania, United States. Our findings suggest there are multiple departments involved in the inventory management process, and the causes of inventory inaccuracy can occur at various stages during processes such as receiving, the material usage recording process, and cycle counting. As a result, inventory inaccuracy impacts an organization's resources and performance in terms of time, cost, and risk. The participants in this study also offered their perspectives to minimize inventory inaccuracy; some suggestions include proper training, clear procedures, increasing the accountability of associates, clear cycle count scheduling, and investing in an efficient system.
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