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Explain two levels of stocking and for each highlight its dangers

      

Explain two levels of stocking and for each highlight its dangers

  

Answers


Ruth
1. Overstocking; this is the keeping of stock beyond the maximum stock level
Dangers of overstocking
- Deterioration of stock value
- High insurance cost
- High personnel cost
- High risk of pest invasion
- High risk of pilferage or fraud
- Holding up of capital

2. Under stocking; this is the keeping of stock below the minimum stock level
Dangers of under stocking
- Idle labour and machinery
- Loss of customers
- Loss of revenue or income
- Higher fixed cost
NatalieR answered the question on May 16, 2022 at 08:15


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