Inventory of materials occurs at various stages and departments of an organization.  A manufacturing organization holds inventory of raw materials and consumables required for  production. It also holds inventory of semi-finished goods at various stages in the plant with various departments. Finished goods inventory is held at plant FG Stores, distribution centers etc. finished goods inventory is held by the organization at various stocking points of with dealers and stockiest until it reaches the market and end customers. Besides raw materials and finished goods, organizations also hold inventories of spare parts to service the products. Defective products, defective parts and scrap also from a part of inventory as long as these items are inventoried in the books of the company and have economic value. Inventory management is the integrated functioning of an organization to achieve maximum coordination and optimum expenditure on materials. It forms the never center in any inventory management organization.

Keywords: Inventory, Finished goods, Optimal utilization