Stock Control

• Stock control charts show how stock levels change over time
• Maximum stock level is the level the business ideally would not want to go above
• Minimum stock level is the level the business ideally would not want to go below
• Holding too many stocks incurs additional costs for storage and insurance
• Opportunity cost of holding stocks is the potential investment in business growth
• Holding too many stocks can lead to liquidity problems
• Holding too many stocks increases the risk of waste
• Going below the minimum stock level leads to lost orders and negative reputation
• Lean production aims to eliminate waste and increase productivity

This module explains stock control and its importance for businesses. It covers topics such as stock control charts, the issues of having too many or too few stocks, and waste minimization strategies like lean production. A stock control chart illustrates how stock levels change over time. It discusses the maximum and minimum stock levels, reorder level, lead time, and reorder quantity. The video highlights the problems of holding excessive stocks, such as increased storage and insurance costs, missed investment opportunities, liquidity issues, and potential waste. On the other hand, it also emphasizes the problems of having too few stocks, including lost revenue, customer dissatisfaction, and worker downtime. The concept of lean production is introduced as a way to minimize waste and increase productivity. Just-in-time production is discussed as an approach that eliminates buffer stocks but may face challenges with economies of scale and supplier reliability. Overall, the video emphasizes the importance of effective stock control for businesses to optimize costs, meet customer needs, and maintain competitiveness.