Logistics Simplified: The 3 Main Inventory-Management Systems

business development business owners career & business Aug 07, 2022
Logistics Simplified: The 3 Main Inventory-Management Systems

One of the reasons why inflation rose in the aftermath of the pandemic is supply-chain problems.  Supply chain problems highlighted the vital importance of inventory management.  When companies manage inventories in a stable manner, operations and transactions proceed without incident. However, when companies experience inefficiencies with inventory management, there’s a negative ripple effect that can paralyze economic activity.


Inventory Management is the Backbone of a Strong Business:

Author Sam Smock explains that “Effective inventory management affects every facet of your business, and makes a significant difference in your bottom line. Inventory management goes well beyond just maintaining stock counts. Modern inventory management systems orchestrate every phase of the product life-cycle.” Here’s a quick summary of the three most ideal standardized techniques of inventory management:


1.    Perpetual Inventory Systems:

This is a type of inventory system in which maximum attention to detail is used throughout every stage of manufacturing.  Raw materials are measured with precision, ordered under specific parameters, and assembled using rigorous calculation and distribution. Perpetual inventory systems are ideal for companies with perennial sales activity. 


2.    Periodic Inventory Systems:

This is a type of inventory system in which moderate attention-to-detail is used throughout the manufacturing cycle.  Instead of acquiring raw materials to facilitate peak output, inventories are built up based on environmental conduciveness.  Periodic inventory systems are ideal for companies with seasonal or cyclical sales activity.


3.    Maintenance/Repair/Operations (MRO) Inventory Systems:

MRO inventory systems are introspective in nature.  Instead of being optimized to satisfy consumer demand, MRO inventory management prioritizes the cost-effectiveness of asset production.  This is to say that an MRO inventory system acquires materials based on its ability to facilitate a low-cost finished product. MRO inventory systems are versatile and can be used in various business models.



Inventories are a very sensitive and integral resource to manufacturing companies.  Mainly because inventories ultimately evolve into the finished goods that consumers purchase.  The more meticulously inventories are balanced, the less disruptions businesses are vulnerable to. If you like what you just read from our blog, you’ll love the various informative courses, workshops, and events listed on our websites and social media. Whether you’re interested in personal development, health and wellness, bettering your relationships, or the overall improvement of your business, give us a call at 1 (800) 913-0222 to find out how Richard Martinez can help you break past your daily struggles and start soaring in success.

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