Below are the types of inventories currently managed by Electrolux and GE- 1. Cy

Question

Below are the types of inventories currently managed by Electrolux and GE-

1. Cycle stock - Cycle stock is the stock in cycle used to fulfill customer demand and is available on hand. It is equal to the total onhand inventory minus the safety/buffer stock. It is used to cover for the sales orders.

2. Safety stock - Safety/Buffer stock is the stock maintained to handle the demand fluctuations. It is the additional stock in the inventory used only when a demand which is more than onhand inventory needs to be fulfilled. Safety stock is calculated based on demand variations and lead time variations.

3. Pipeline stock - This is also called intransit stock as it is the stock which is in transit to the customer from the warehouse/manufacturers but hasn't reached the customer yet.

4. De-coupling stock - This is the buffer stock accumulated between to interdependent operations as a buffer against any machine breakdown or unevenness in production rates etc.

5. Anticipation stock - Anticipation stock can be raw material, components or finished goods stocked in anticipation of an unexpected event which might include spikes in demand, possibility of increase in prices in future, erratic production etc.

Explanation / Answer

Determine the types of inventories Electrolux and General Electric currently manage and describe their essential inventory characteristics.

Please provide your references.

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