Three Little Words

Inventory reduction programs require alignment of technology, infrastructure and culture 

By Richard E. Crandall and William “Rick” Crandall

Although the call to reduce or eliminate inventory is strong, business managers face conflicting priorities. They want enough on hand to prevent shortages, but not so much to raise holding costs or require markdowns of excess merchandise at the end of a season. Accountants call inventory an asset; practitioners call it a liability in some contexts. Most consumers want variety but can be overwhelmed by too many choices. Marketing managers desire more inventory with various models; accountants demand less; and production managers want long and standardized runs. Everyone has an opinion; yet, there are few, if any, universal solutions to the many facets of inventory management.