The Role of Inventory in Corporations

The thesis has been developed on the role of inventory in companies, highlighting the essential practices that companies, especially retailers, should perform. Inventory is a company's asset, meaning that it states part of value of an entity. It represents one of the main cost voices, as a company may incur in very high inventory's expenses and, in the main time, holding a messy inventory can cause serious financial consequences. The aim of every company is managing stocks efficiently in order to optimize operations and procedures while reducing costs and inefficiencies. Retailer businesses and multinationals have the same inventory purpose but, with different resources available. That's why retailers have to be organized and plan accurately to minimize unnecessary costs and improve companies' practices and procedures. After a brief introduction of the inventory types, costs associated, functions and importance, it has been presented different techniques of management remarking the key role covered by this function. Then, the methods of cost valuation and tracking system have been submitted and finally, useful practices have been shown with the aim of minimizing expenses and exploiting the technological tools available. Retailers should rely on software for the recording and reporting of movements and financial transactions. They perform a lot of operations automatically, letting managers focusing more on the core business. In conclusion, inventory can be defined as essential and risky at the same time. It is important to take the advantages from the optimized and innovative practices while monitoring and controlling costs.