Scientific paper - Original scientific paper
Management of inventory in a company

Kontuš, Eleonora (2014)
Language English
Title (English)Management of inventory in a company
AuthorKontuš, Eleonora
Abstract (English)
Firstly, the purpose of the empirical part of the study is to analyze the inventory balances of surveyed companies and secondly, to explore the dependence between companies’ level of inventory and profitability expressed in terms of return on assets. Thirdly, the aim of the theoretical research is to explore the cost and benefits from changes in the inventory level as well as to define variables that determine net savings from changes in inventory level. An optimal inventory level should be based on consideration of incremental profitability resulting from increased merchandise with the opportunity cost of carrying higher inventory balances. The results will provide a model equation for calculating net savings from changes in inventory level as well as a new mathematical optimization model. With this model a company can consider net earnings from changes in inventory level and establish the optimal inventory level as well as improve profitability.
Keywords (English)inventory balances profitability net savings mathematical optimization model optimal inventory level
Publication typescientific paper - original scientific paper
Publication statuspublished
Peer reviewpeer review - international
Journal titleEkonomski vjesnik : Review of Contemporary Entrepreneurship, Business, and Economic Issues
Numbering2014, Vol. XXVII, No. 2, pp 245-256
Datepublication: 24.12.2014.
Article URL
Scientific fieldSOCIAL SCIENCES