An order made for an exact number of goods and in precise specifications based on actual requirements and levels of stocks, which prevents excess stocks or supplies.
Available Stock
The amount of inventory currently stored which is available to be immediately sold or issued or used for operating purposes.
Average Cost Method
An inventory valuation technique if the total of the cost of goods available is divided by the total of the units to find a uniform cost per unit.
Barcode
A scannable identification code assigned to items and used to quickly and accurately identify inventory, track, and bill it.
Batch Number
A particular code assigned to products produced or received together, used for tracing products, checking quality and recalling them.
Batch Tracking
The process of tracking inventory by batch numbers and tracking surface use, flow and expiry in the supply chain.
Bill of Materials (BOM)
A structured list of all of the raw materials, components and quantities needed to produce a finished product.
Bulk Inventory
Inventory held or bought in bulk, usually to lower the costs of procurement or the costs of high-volume sales.
Carrying Cost
All costs associated with holding inventory such as storage and insurance costs, capital costs, deterioration of items, and handling.
Cash Conversion Cycle
A financial metric used to measure the speed at which inventory investment is converted into cash through making sales.
Centralized Inventory
An inventory setup where all the stock is managed from a single location, leading to improvement in controlling and visibility.
Closing Stock
The value or amount brought of inventory on hand at the end of an accounting period.
Consignment Inventory
Stock that is provided by a vendor but is only paid for after it is sold by the retailer/distributor.
Cycle Counting
A continuous method of verifying inventory in which selected items are counted on a regular basis rather than going for a full count of the stock.
Dead Stock
Items that have not sold for a long time and are unlikely to bring future revenue.
Decoupling Inventory
Buffer stock kept between production stages to minimize disturbance of production caused by supply delays.
Delivery Challan
A document issued with goods in order to acknowledge dispatch or delivery but does not state how much is to be paid.
Demand Forecasting
The process of forecasting the demand for a product in the future based on past data and trends, as well as an analysis of the market.
Dependent Demand
Demand that is equal to the production requirements of some other product i.e. components need for finished goods.
Direct Materials
Raw materials which, during their processing, become an integral part of the finished product.
Discrepancy Report
A document showing discrepancies between physical inventory and inventory recorded in the system.
Drop Shipping
A fulfillment model in which the company doing the selling does not store inventory, but the products are shipped by the company holding the inventory to the customer.
Economic Order Quantity (EOQ)
A calculation that determines the size of order that reduces the total costs associated with inventory related costs.
Ending Inventory
The value of an inventory after the item has been sold and used for a accounting period.
Excess Inventory
Stock levels that are higher than the sales demand, with associated increased storage costs and risks of obsolescence.
Expiry Date
The date after which a product should not be used or sold because of safety and or quality considerations.
FIFO (First In, First Out)
An inventory method in which the older stock is issued or sold prior to the newer stock.
Finished Goods
Finished products that are ready for sale or distributing to the customers.
Fixed Order Quantity
A replenishment method in which a fixed amount is ordered to be delivered whenever a certain stock level is reached.
Freight In
Transportation expenditure incurred to transport bought goods into storage or business premises.
Freight Out
Delivery Costs incurred while delivering goods to customers or other locations.
Godown
A warehouse or storage room for the storage of inventory included in the context of Indian businesses.
Goods in Transit
Inventory that has been sent but has not been received at the destination.
Goods Receipt
Confirmation that ordered goods have been received, used to update inventory and check on supplier deliveries.
Gross Inventory
The entire recorded inventory value before damage, losses or write-downs.
Hedge Inventory
Extra stock held to guard against uncertainty of supply, demand or prices.
Holding Cost
Expenses helping hold and preserve to inventory for time, such as warehousing and capital expenses.
Idle Inventory
Stock that sits around unused for long periods of time and does not manage the active operations or sales.
IMEI Number
A unique identification number given to mobile devices to track, give warranty and compliance purposes.
IMEI Tracking
Monitoring the individual electronic devices in inventory using their IMEI numbers for their traceability and control.
Inbound Inventory
Goods received from supply or manufactures into storage or warehouse locations.
Inventory
All those types of goods and materials which are in possession of a business for the purpose of sale, production or operation.
Inventory Allocation
The assignment of available stock to certain orders, locations or customers.
Inventory Audit
A verification process that ensures physical inventory is in line with recorded information on stock.
Inventory Classification
Grouping inventory items according to some criteria e.g. value, usage, criticality in order to better focus management.
Inventory Control
Practices and systems to maintain optimum stock levels to avoid losses or shortage.
Inventory Days
Days Average Number of Days inventory held before being sold or used.
Inventory Forecasting
Estimating future demands based on the past trends of sales, seasonality, and demand patterns.
Inventory Holding Cost
The overall cost accumulated over the lifecycle of a piece of inventory due to it being stored.
Inventory Management
The process of end-to-end planning, ordering, storing, tracking and optimising inventory.
Inventory Optimization
Balancing stock availability and cost efficiency against demand so that no excess stock is held.
Inventory Projection
A look forward estimate of inventory requirements on the basis of expected sales and current inventory.
Inventory Reconciliation
Matching physical inventory counts to system records to find out and correct discrepancies.
Inventory Shrinkage
Theft, damage, wrong place, or recording of stocks and loss of stock due to these.
Inventory Tag
A physical or digital identifier attached to items to track and identify them.
Inventory Tracking
Monitoring stock movement between locations in order to keep proper and real-time record of the inventory.
Inventory Turnover
A performance metric that shows the frequency of selling and restocking an inventory.
Inventory Valuation
Assigning an economic value to inventory for accounting and financial reporting.
Inventory Variance
The difference between the actual inventory and recorded value of inventory.
Item Unit
The standard measurement to count or track the inventory items.
Just-in-Time (JIT)
An approach to inventory, in which stock is acquired only when needed, minimizing storage cost takes place.
Landed Cost
The full cost of purchasing inventory including purchase cost, transportation, duties and taxes.
LIFO (Last In, First Out)
An accounting practice of valuing an inventory in which recently purchased items are issued or sold first.
Lot Number
A code that is used to identify a particular production or acquisition batch.
Low Stock
Alert condition when inventory quantities are near the reorder level.
Manufacturing
The process of converting raw materials into finished products through labour and machinery process.
Manufacturing Date
The date that a product was created or made.
Minimum Order Quantity (MOQ)
The lowest amount that a supplier provides per order.
Obsolete Inventory
Stock that has dated, becomes useless or in demand, and can no longer be sold.
On-Hand Inventory
The actual amount of inventory physically available at a place.
Opening Stock
Inventory held in the beginning of an accounting period.
Order Lead Time
The time that eluggests between the order and receiving the goods.
Order Picking
The process of determining the types of inventory items that will be used to meet customer order requests.
Order Point
The amount of the inventory that should be stocked before the item would need to be replenished.
Out of Stock
A state of available items of stock to be sold or used for supply.
Outbound Inventory
Stock which is sent out of a warehouse for delivery or by transfer.
Overstock
Inventory levels that are above current demand requirements.
Overstocking Penalty
The financial and operational consequences of having too much inventory.
Packaging
Materials used to protect products and present them during storage and transit.
Packing List
A document containing the contents of a shipment to confirm for the purposes of verification.
Perpetual Inventory
A system in which the current accounts of inventory are updated constantly after each transaction.
Physical Inventory
A physical inventory level count performed to confirm physical quantities of the actual stock of inventory.
Pipeline Inventory
Inventory, which is in the producing stage or transit, but not for sale.
Procurement
The process of obtaining, negotiating and buying goods or services.
Quantity on Hand
The actual number of units of available inventory at a specific period of time.
Raw Material
Unprocessed materials used in manufacturing the finished product.
Real-time Stock
Live inventory data of existing stock levels in real time.
Reorder Point
The amount of stock at which a new purchase order should be placed.
Replenishment
The activity of replenishing stocks of the inventory to keep desired levels.
Reserved Stock
Inventory that has been allotted to meeting specific orders and is not available for general use.
Restock
The process of replenishing unsold or consumed inventories.
Retail Inventory
Products that are held through retailers for direct sale to consumers.
Return on Inventory
A profit method produced from investment in inventory.
Safety Stock
Additional inventory used to handle demand or supply uncertainty.
Scrap Inventory
Items that are damaged, defective or impossible to use.
Serial Number Tracking
Tracking individual pieces of inventory with unique serial identification.
SKU (Stock Keeping Unit)
An individual internal code for identifying and controlling products.
Slow-Moving Inventory
Stock having low sales frequency and not sold over long periods of time.
Spoilage
Loss of inventory through deterioration, damage or expiry.
Stock Adjustment
Corrections done to inventory records to reflect actual stock levels.
Stock Aging
Analysis of the length of time of inventory items in storage.
Stock Alerts
Automated messages which are triggered by a predefined stock condition.
Stock Control
Different methods applied to control inventory movement and availability.
Stock Ledger
A detailed record of the transactions of the inventory over time.
Stock Level
The amount of inventories kept for normal demand.
Stock Maintenance
Activities to ensure inventory quality, accuracy and usability.
Stock Status
The present state of the resources of the stock of inventories.
Stock-Out
Completely depleted stock-out of a particular item.
Supplier Lead Time
The duration it takes for a supplier to deliver goods after receiving the order for the same.
Supply Chain
Network related to production, storage, and delivery of products.
Surplus Inventory
Inventory which is not operational needs.
Turnover Ratio
A metric used to determine how effectively inventory is transformed into costs through sales.
Unit of Measure
The standard unit of measuring inventory.
Unplanned Inventory
Over-stock due to incorrect planning or cancellations.
Unsellable Inventory
Inventory that can not be sold that must be written off.
Vendor-Managed Inventory (VMI)
An arrangement in which suppliers monitor and restock customer stock.
Warehouse
A place for storing and controlling inventory.
Warehouse Inventory
Stock kept in warehouse locations.
Weighted Average Cost (WAC)
An inventory valuation method based on the average cost per unit.
Work in Progress (WIP)
Partially completed goods, yet in the production process.
Write-Down
Sacred loss of inventory by reduction in value in market.
Write-Off Inventory
Eliminating inventory that is not being fragmented from accounting records.
Zero Inventory
An approach to keeping as little stock as possible through proper planning.
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