Raw materials: Items that are used in the manufacturing process to produce finished products.The three main inventory types or categories for decoupling are: What are the 3 types of inventory in supply chain management? The company might hold extra display screens and run a second shift for certain subassemblies so that neither element derails the company’s ability to meet customer demand. There may be periodic disruptions in touchscreens due to heightened demand, while the keyboard and motherboard subassemblies are slow-moving processes compared with the rest of production. Companies may also selectively stock up on maintenance, repair and operating (MRO) goods critical for production, like paint or PPE.ĭecoupling inventory is also a useful tool to mitigate the effect of some manufacturing or supply chain processes moving faster than others.Ĭonsider a computer manufacturer. What Is Decoupling Inventory?ĭecoupling inventory is the term used when product manufacturers set aside extra raw materials or work in progress items for all or some stages in a production line, so that a low-stock situation or breakdown at one stage doesn't slow or stop operations. While many challenges are outside a company's control, responsibility for getting production back on track ultimately falls on the business, specifically, supply chain and inventory managers.ĭecoupling stock provides a cushion against inventory shortfalls and can help decision-makers cope with supply chain disruptions. ![]() These disruptions can be costly in lost time, money and ultimately customer satisfaction. ![]() East, Nordics and Other Regions (opens in new tab)įluctuations in demand, raw materials shortages, storms that disrupt shipping routes … a litany of issues can send ripples through supply chains.
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