Minimum Maximum Technique: The minimum maximum system is often used in connection with manual inventory control systems. The minimum quantity is established in the same way as any re order point. The maximum is the minimum quantity plus the optimum lot size. In practice a requisition is imitated when a withdrawal reduces the inventory below the minimum level and the order quantity is the maximum minus the inventory status after the withdrawal. If the final withdrawal reduces the stock level substantially below the minimum level the order quantity will be higher than the calculated EOQ.

The effectiveness of a minimum maximum system is determined by the method and precision with which the minimum and maximum parameters are established. If these parameters are based upon arbitrary judgments with a limited factual basis the system will be limited in effectiveness. If the minimum maximum are based on an objective rational basis the system can be very effective.

Posted Date: 3/1/2013 3:18:23 AM | Location : United States

Ask an Expert

Related Discussions:- Minimum maximum technique , Assignment Help, Ask Question on Minimum maximum technique , Get Answer, Expert's Help, Minimum maximum technique Discussions

Write discussion on Minimum maximum technique
Your posts are moderated

Write your message here..

Related Questions

What is the meaning of term entrepreneurship, What is the meaning of term E... What is the meaning of term Entrepreneurship? Meaning of Entrepreneurship: Entrepreneurship refers to a process of action an entrepreneur undertakes to establish h

Why management might choose a direct approach, Explain the reasons why mana... Explain the reasons why management might choose a direct approach to a system changeover in preference to other alternatives (such as phased, parallel running or pilot schemes).

Process of preventive maintenance, Retards or show down the process of ... Retards or show down the process of deterioration or wear: To reduce friction. Assess to wear and determine on diagnosis the action required. To check a breakdown a

What is a theory, QUESTION 1 i) What is a theory? ii) Identify and d... QUESTION 1 i) What is a theory? ii) Identify and describe the functions of theories. QUESTION 2 i) How do communication theories help us? ii) What is communicatio

What is video-conferencing and what are its requirements, QUESTION An a... QUESTION An area where telecommunication is gaining ground among businesses and academics is video-conferencing. However Video-Phone systems have existed for years, but have no

What are the functions of trade unions, What are the functions of Trade Uni... What are the functions of Trade Unions? The functions of trade unions are as follow: a. The provision of friendly services as like a place for leisure pursuits, information

How should handled a good grievances, How should handled a good grievances?... How should handled a good grievances? A good grievances handling must: a. It must be simple, easy to know and to operate b. It must settle grievances at lower level c.

Dimensions of leadership role in change management, Question 1: Accordi... Question 1: According to Henry Fayol, "Leading is one of the main functions of any manager". In this context, explain the importance of leadership for the successful managemen

Functional structure, what is the span of control of the financial manager what is the span of control of the financial manager

Explain potential conflict between management and company, CRSL has a large... CRSL has a large auditorium which can cater for 300 people and is ideal for formal balls and functions. The auditorium can also be reconfigured to cater for 100 people. The Seasons