Logistics as a part of my everyday life / Inventory Management

Inventory Management is a part of Supply Chain management/Logistics.  It is supposed to keep track of what goes in and what goes out of company’s inventory. The inventory can be separated into a stock area of the single components and an area for the finish product. In total this would mean that there are two “Stock In” and also two “Stock Out” sides. The first “Stock In” is for the incoming single components or raw materials of the product that is manufactured in the company whereas the first “Stock Out” is from the storage area of single components to the production department. The next “Stock In” is for the finished product going into the storage area and the next “Stock out” is from storage to sales department. There are several ways of performing Inventory management. Especially big companies use software based Inventory management. Three possible Methods are for example:

  • Stock Review
  • Just-In-Time methodology
  • ABC analysis

Why am I talking about this topic? Because today I realized that inventory management is part of my daily life. For example, let’s assume I own and run a company that is active in the “Sandwich Assembly” business. In order to be able to consistently put out sandwiches of the same quality, it is necessary to always have a complete stock of all the single components like bread, salad, ham, cheese and in my case also mustard. So all these components are procured from a supplier (mercadona) and are delivered to me also by me. So there is a product flow from mercadona to me and a financial flow from me to mercadona.  These products resemble the raw material coming into my storage area for raw materials and are then assembled for the later distribution to the consumer.  Now if I wouldn’t keep track of my stock and would run out of one component, my customer would not be very happy so I have to always know how much of each material is in my inventory and when it is time to restock on a single component. Now let’s get back to that mustard that started this whole thing. I just realized that my mustard bottle is actually helping me keep track of my mustard stock.


It tells me when I am half down and also when it is time to go out and buy a new bottle. This greatly helps my ability to produce sandwiches with the quality my customer expects and therefore it (hence inventory management) is crucial for the success of my or any company. Sadly, I am my only customer so my business is not very lucrative but nonetheless it is a great example of how the very basic aspects of logistics are a part of my everyday life.



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