Benefits Derived from Material Standardisation: A Study of Small Manufacturing Firms

Inventory costs are the basic costs which influences the whole business design. It connotes the diverse costs involved (Storage, Perishability, safety etc.) in managing inventories. The present study divulges the mean rating of inventory variables that affects inventory management in 44 small scale units operating in district Udhampur of J&K State divided into ten lines of operations. The research framework was examined by empirical analysis of primary data collected. Validity and reliability of the scales in the construct were assessed through BTS and Cronbach-alpha. The results of ranking tables revealed that the major variables affecting inventory management are Overall inventory turnover ratio, Raw material inventory turnover ratio, Work-in-process inventory turnover ratio, Finished goods inventory turnover ratio and Out of stock index. The variable Raw material inventory turnover ratio emerged as the main variable affecting inventory management and out of stock index being the least decipherable effectuating variable deployed in managing inventories.