1⟩ Do you know what is the importance of EOQ?
The EOQ level is the point at which stocking costs are at their lowest point for a given item.
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“Inventory Control Manager based Frequently Asked Questions by expert members with experience as Inventory Control Manager. These questions and answers will help you strengthen your technical skills, prepare for the new job test and quickly revise the concepts”
67 Inventory Control Manager Questions And Answers
2⟩ What is work-in-process?
Inventories are semi-manufactured products. They represent products that need more work before they become finished product for sale.
3⟩ Explain me what is Inventory Control?
☛ Inventory Control is the supervision of supply, storage and accessibility of items in order to ensure an adequate supply without excessive oversupply.
☛ It can also be referred as an accounting procedure or system designed to promote efficiency. Or we can say that it assures the implementation of a policy or safeguard assets or avoid fraud and error etc.
In Economics, Inventory Control helps in reducing the overhead cost without hurting sales.
In the field of Loss Prevention, Retail Inventory Control management helps in preventing shoplifting and other issues.
4⟩ Tell us what is inventory control?
Inventory control is the process of reducing inventory costs while remaining responsive to customer demands. By this definition a store would want to lower its acquisition, carrying ordering and stock-out costs to their lowest possible levels. However a store would need to have enough inventories to meet any needs of its customers.
5⟩ Explain me what is total stocking cost?
Total stocking cost is the cost to the store of holding a good in its inventory. The stocking cost consists of the carrying cost times half the quantity in inventory and the order completion cost times demand divided by the quantity. In its mathematical form the cost is represented by TSC=(Q/2)C + (D/Q)S.
6⟩ Tell me what is Shrinkage Calculation in Inventory?
In financial accounting, the term inventory shrinkage is the loss of products between point of manufacture or purchase from supplier and point of sale. The term shrink relates to the difference in the amount of margin or profit a retailer can obtain. If the amount of shrink is large, then profits go down which results in increased costs to the consumer to meet the needs of the retailer.
In retail terms, shrinkage refers to a company's percent loss resulting from damage, product expiration and theft of unsold products. Retail shrinkage can happen anywhere along the production and sale chain, including at the factory, in transit or at the retail location.
You can calculate retail shrinkage by dividing the value of goods lost to shrinkage by the total value of goods that are supposed to be in the inventory.
Shrinkage =
( Total value of the goods that you are supposed to have in your inventory - Total value of the goods that is physically stocked in your inventory )
/ Total value of the goods that you are supposed to have in your inventory.
i.e. Shrinkage = (Book stock - Actual Stock) / Book Stock
= Total Value of goods lost / Total value of the goods that you are supposed to have in your inventory
7⟩ Explain how can the value of inventory be determined?
The value can be found using four methods in inventory control. The first is the specific cost in which each item's cost is added together for the inventory's value. A second method is to use the weighted average of the costs for a period to determine value. A third method is first in, first out. In this method value is measured using the latest costs of goods while working towards the beginning of the period until all goods in inventory are valued. The final method is last in, first out. In this method the costs of gods at the beginning of the period are used to determine the inventory's value much like FIFO.
8⟩ Explain me do I need to recompute stocking costs for the EOQ level?
Yes, in order to compare stock costs when using the EOQ model you must compute the costs for both the original level and the EOQ level of order quantities.
9⟩ Tell me why is inventory management so important?
Inventory management is important so that the influx of supplies and equipment can be handled according to the company’s requirements. It is also imperative to ensure that inventories are handled properly so that everything within an organization is accounted for.
10⟩ How to determine the numbers to use in the EOQ formula?
To determine which numbers to use you must look for the following items. The number of items per order is the quantity(Q). The number of items that can be sold is D. D may be the forecast demand for that particular good. The cost of placing the order is used for S. The final number to find is the carrying cost(C) which is the cost of the item to be held in inventory.
11⟩ Tell me how to determine the frequency for ordering and inventory production if it's not set solely by factories or the supply organization?
Ideally, there are two factors: companies should consider calculations that minimize the overall cost such as inventory and changeover costs. They also should base frequency on negotiations between the different parties involved and factor in upcoming events such as promotions and uncertainties like bad weather.
12⟩ Do you know what is ABC Analysis?
It is an inventory categorization technique often used in Materials Management. It is also known as Selective Inventory Control.
A ITEMS: very tight control and accurate records.
B ITEMS: less tightly controlled and good records.
C ITEMS: simplest controls possible and minimal records.
The ABC analysis suggests that inventories of an organization are not of equal value.
Example of ABC class are:
(1)
‘A’ items – 20% of the items accounts for 70% of the annual consumption value of the items.
‘B’ items - 30% of the items accounts for 25% of the annual consumption value of the items.
‘C’ items - 50% of the items accounts for 5% of the annual consumption value of the items.
(2)
"A" approximately 10% of items or 66.6% of value
"B" approximately 20% of items or 23.3% of value
"C" approximately 70% of items or 10.1% of value
13⟩ Do you know how is GR/IR account related to Inventory?
If you are involved with inventory, then you need the GR/IR account (Inventory Account) when the IR is posted.
If you are not involved about inventory, then the system does not need the GR/IR account when the IR is posted, the system needs a G/L instead of the GR/IR account.
14⟩ Tell us what makes a good forecasting model?
A good forecast model will have reasonable costs. the accuracy of its forecasts will allow good decision making. The model will have ample data available for its use and a relevant time span. The model finally will have a low interference level.
15⟩ Explain me what are the types of reordering systems that can be used in inventory control?
There are several types of reordering systems, in this module we discussed three. The fixed order quantity uses fixed quantities of goods ordered at various order points to replenish inventory. The fixed order period use fixed times of reorder with various order quantities to replenish inventory to preset levels. The final system, just in time uses a constant flow of goods to match the level of demand.
16⟩ Explain me what should be recorded in a physical count of inventory?
When conducting a physical inventory the classification, location and number in stock of a good should be recorded.
17⟩ Face to Face Inventory Control Manager interview questions
☛ What do you consider your strengths and weaknesses as Inventory Control Manager?
☛ What do you think you can bring to this Inventory Control Manager position?
☛ Give an example of how you set goals and achieve them.
☛ How do you cope without motivation?
☛ How would you feel about working for someone who knows less than you?
☛ What is your greatest achievement outside of work?
☛ Tell me about an important goal that you set in the past.
If possible, quantify your results in terms of savings made and increased productivity for instance. This is your chance to show your depth and dimension as a person. These are excellent Inventory Control Manager interview questions that lets a potential employee really sell themself.
18⟩ Informational Inventory Control Manager interview questions
☛ What was the most stressful situation you have facedas as Inventory Control Manager?
☛ How would your teacher or other Inventory Control Manager describe you?
☛ What salary range are you looking for?
☛ What is your personal mission statement?
☛ What are your weaknesses?
☛ Have you done this kind of work before?
☛ What did you do to prepare for this job interview?
19⟩ Operational and Situational Inventory Control Manager Job Interview Questions
☛ If you discovered an inventory error, how would you act?
☛ Imagine one of your orders wasn’t delivered on time creating a risk that the inventory would be soon inadequate to cover demand. How do you resolve this? How do you protect inventory from such occurrences?
☛ If I asked you to conduct forecasting analysis to optimize our inventory, how would you go about it?
20⟩ Inventory Control Manager Position Related Job Interview Questions
☛ What did you enjoy most (least) about your last job?
☛ What would you have liked to have done more of in your last job?
☛ What are the three most important things you look for in a job?
☛ Describe your understanding of what is required to fulfill this role.
☛ What objectives would you set for your first 12 months in this position?
☛ What aspects of your current job do you consider to be most critical to your success in this role?
