Keep in mind that, for the context of this article, we are talking about inventory. This term is often used in a business context to determine the bottom line for the business in question. Raw materials can be included in stock only if the company sells these raw materials to customers. Stock: Finished products that are ready to be sold into the marketplace.This term is often used for accounting purposes to determine the status of products and their materials. Inventory: Finished products that are ready for distribution to retailers or wholesalers, the work-in-progress goods that are still being built or assembled, and the raw materials that are being used to create the products.Namely, many people are confused by the concept of inventory vs. Here, we’ll break down everything you need to know about these inventory types and what makes them different.īefore we get into all the differences between pipeline inventory and decoupling inventory, there are a few definitions that will be important to understand.
Both of these elements are crucial to crafting a management system that works for your company, and they are often confused by new business owners.
Two of the most vital categories of inventory are pipeline inventory and decoupling inventory. Without being able to accurately track where your inventory is at all times, or without knowing how much inventory you have for a certain product, you’re likely to experience delays in getting items to customers or over-or under-ordering items.Ī good inventory management system has several different elements, including multiple types of inventory. For any business, inventory management is a key component to success.
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