myz-vgb.ru A Business Encyclopedia

Outsourcing Inventory System

Definition: The Outsourcing Inventory System is adopted by the firms to reduce the burden of manufacturing the components of the finished goods in-house i.e. within the organization. Thus, a system of buying the products or components from outside vendors rather than manufacturing internally is called as Outsourcing Inventory system.

Many companies develop a single source of supply from where the needs of the material can be fulfilled. While many others help in developing the small and medium sized ancillary units to supply the adequate quality components, as required for the manufacturing of the finished goods.

Tata Motors is the prominent example that uses the outsourcing inventory system. It has developed several ancillary units around its manufacturing plants to get the parts and components in time. This has benefited the ancillary units as well, with the help of Tata Motors they are able to manufacture the best quality components.
Likewise, Tata Motors, Maruti, an automobile company, uses this inventory system to fulfil its need for the components.

Thus, with the help of an outsourcing inventory system, a manufacturing firm can reduce both the time and money involved in manufacturing the components in-house. Also, it enables an organization to capitalize the manufacturing efficiency of others, which could not have been possible, if manufactured internally.

Leave a Reply

Your email address will not be published. Required fields are marked *

Shares

Related pages


define demand functiondefinition of a bridge loanverbal communication wikipediasegmented pricing definitionlease leasebackhr balanced scorecard definitionmonopolystic competitionlaw of diminishing marginal utility economicscamel rating of banksreferential powervictor vroom expectancy theoryexplain demand functionvestible trainingsalivation definitiondefine retailsdefinition of demand elasticityhow to check employee provident fundsalivation definitionhow to calculate total asset turnover ratiohow to draw an indifference curveprofitablility indexsupervisor meaning in hindifinancial retrenchmentwhat does loafing meandisadvantages of a tall organisational structurewhat are commercial papers in indiatotal asset turnover exampleelastic demand economics definitionsavings account investopediamonopolistic market definitionhence meaning in hindiadvantages and disadvantages of linear programmingwritten down value method of depreciation formulaspearman rank correlation coefficient examplemotivation hygiene theory by frederick herzbergmotivational theoristswhat is participative leadershipconsumer equilibrium marginal utilitydefine demand deposit accountmonopolistic meaningdefine queuing systemunion bank neft timingshorizontal marketing channelmonetariststock market speculator definitioncarrot and stick definitiondefinition of apprenticesmonopolistic competition definition economicsfixed assets turnover ratio calculatordefine innovative entrepreneurarbitrage forexdefine autocratic leadershipansoff's strategic opportunity matrixcommunication 7csblake and mouton leadership griddivest definitionwhat is cheque truncationiit aptitude testsociocultural factors examplesthe equity theory of motivationpolycentric marketingdefine queinggalloping inflation definitionexamples of ethnocentric companieswhatishumanresourcedefinition of graphic scalefranchise economics definitiontrait theory allportdiminishing marginal utility in economicsdefinition of reverse repo rateexpectancy theories of motivation