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Inventory Management A-Z: Supply Chain & Business Operations

Name: Inventory Management A-Z: Supply Chain & Business Operations
Rating: 4.6 (8483 reviews)

Inventory Control Basics: MBA beginner course for Purchasing, Logistics, Demand Forecasting & Planning and Safety Stock

Created byLaurence Gartside, Rowtons Training

Last updated 10/2026

English

Arabic [Auto],German [Auto],

What you'll learn

Become the trusted inventory authority in your team
Gain a comprehensive understanding of Inv Mgt for manufacturing or service businesses
Little's Law - calculate and understand required WIP using Little's Law
Economic Order Quantity (EOQ) - calculate an EOQ to balance inventory costs
Price Break Model - apply advanced EOQ when purchase prices vary with order quantity
Inventory Dynamics - understand how inventory levels change over time to make better decisions
Order Timing & Inventory Control - know when and how to reorder
ABC Analysis - classify and prioritise inventory to focus attention where it matters most
Performance Metrics - use the essential KPIs to keep your "finger on the pulse"
Safety Stock calculations - use simple and statistical methods step by step
Demand Forecasting - understand forecastability and key forecasting methods
Demand Planning - understand variability and improve inventory decisions
S&OP - connect forecasts with inventory and production plans
MRP - understand materials planning for inventory and production
Inventory Strategy - understand MTS, MTO, JIT and Postponement
Increase profitability, improve delivery and use your resources more efficiently
Boost your career: increase your confidence to see and lead change

Course content

18 sections • 79 lectures • 5h 5m total length

Motorbiking "Inventory" down Africa8:02
Learn how inventory management drives profitability across purchasing, logistics, supply chain, and operations, and master types, costs, metrics, and when to order, including minimum inventory and safety stock.
What is Inventory Management?3:25
Understand how inventory management functions within supply chain and operations management to balance customer service and availability against holding costs, with links to finance, logistics, accounts, and purchasing.
Why is Inventory Management Important?3:57
Understand how inventory acts as working capital, impacting cash flow and costs, while meeting demand to sustain customer satisfaction, brand loyalty, and business success.
Any Questions0:47
Engage with the instructor and share questions to strengthen your understanding of inventory management a-z, while recognizing how early review prompts on Udemy boost visibility and enrollment.
Course Topics2:33
Explore inventory basics: types, forms, locations, classification tools; plus why we stock, five good reasons, fourteen not good reasons, costs, performance metrics, and order decisions like eoq, price break model.
Section 1 Quiz

Why do we "need" Inventory?2:53
Explore why inventory matters for availability, showcase products to customers, manage supplier minimum orders and lead times, and understand work-in-progress and Little's Law, with drop shipping as a no-inventory alternative.
Why Else do we Hold Inventory?6:00
Inventory protects against supply and demand uncertainty by buffering raw materials, work-in-progress, and finished goods, while exploiting price fluctuations and enabling level production and economies of scale.
Other "less good" Reasons for Inventory6:25
Identify less good reasons for inventory, such as over-ordered raw materials and forecast errors. See how large work-in-progress, finished goods, and transport delays raise lead times and risk unsold stock.
Little's Law7:45
Apply little's law to determine minimum work in progress from throughput rate and throughput time with L = Lambda W, and rearrange to W = L / Lambda for examples.
Little's Law: The Camera Factory9:12
Use little's law on the camera factory: 1,000 per day, 2-day cycle, 3,000 wip; halving wip isn’t feasible with current throughput and time, so consider buffers protecting bottlenecks.
Essential Buffer WIP and Bigger Objectives1:51
Little's Law - Exercise
Section 3 Quiz

Costs and Financial View of Inventory5:44
Evaluate how inventory incurs costs, including opportunity cost, cost of capital, obsolescence, handling, storage, insurance, and overheads. Businesses often estimate inventory cost at 20 to 30 percent of value annually.
Ordering, Holding & Operational Costs9:34
Explore the operational costs of inventory by detailing ordering costs—from research to processing and delivery—alongside holding costs like storage, security, and depreciation.
Operational Costs of Inventory - Exercises
Scottish Whiskey1:52
Examine how whiskey aging in oak barrels increases value and profitability, with scotch rules, global inventories, and Scotland's 20 million barrels worth $50 billion, rising about 10% annually.
Stockouts, Risk & the Inventory Trade-Off11:24
Learn how stock-outs across raw materials, WIP, finished goods, and service spares drive lost sales, delays, and blame, and apply balanced inventory aims to minimize holding costs.
Rock Boat Analogy3:33
Explore how the rock boat analogy reveals how excess inventory hides scheduling flaws and supplier unreliability, and why prudent, gradual reduction exposes problems to build leaner, lower-cost operations.
Section 4 Quiz

Measuring Inventory Performance - Metrics & KPIs4:25
Explore metrics and KPIs for inventory management from a business perspective, covering inventory days, days on hand, inventory dollar days, shrinkage, and control charts.
Popular Inventory Metrics: GMROI, Shrinkage & Sell-Through5:07
Explore popular inventory metrics including inventory turns, days on hand, inventory dollar days (IDD), throughput dollar days (TDD), GMROI, shrinkage, sell-through rate, product performance, and loss sales estimation.
Inventory Turns and Days on Hand9:48
Inventory turns measure sales relative to average inventory; higher turns signal better performance and can be calculated as sales over average inventory, with days on hand 365 divided by turns.
Control Charts4:43
Monitor inventory levels over time with control charts, set upper and lower limits, and analyze deviations using the area above or below limits.
"Inventory Dollar Days" and "Throughput Dollar Days"3:49
Explore inventory dollar days and throughput dollar days from the theory of constraints, and compute gross margin return on investment by dividing by average inventory value.
Measuring Performance - Exercise
Section 5 Quiz

Part Classification - Introduction2:19
Explore how different inventory types are classified by cost, importance, demand, and shelf life, including dependent vs independent demand, ABC classification, and runners, repeaters, and strangers.
ABC Analysis3:12
Group inventory with abc analysis, dividing items into a, b, and c by value and sku count. Prioritize A parts, observe and adjust B parts, and replenish C parts.
Runners, Repeaters & Strangers4:25
Classify inventory into runners, repeaters, and strangers by demand frequency and production cadence. Runners require continuous replenishment with lean or JIT; repeaters follow regular, predictable schedules; strangers are ad hoc.
Independent vs Dependent Demand1:13
Differentiate independent demand from dependent demand by showing how the independent demand for a car drives sub-assemblies and raw materials, which are dependent on that demand.
BOM & MRP3:07
Learn how the bill of materials links independent demand items to dependent components, enabling materials requirements planning and master production scheduling for purchasing, work orders, and reporting.
ABC Classification of Inventory - Exercise
Section 6 Quiz

Basic Inventory Dynamics - Introduction0:41
Explore inventory dynamics by examining demand rate, re-order points, safety stock, and lead times, and learn how these factors interact to predict inventory levels over time.
Inventory Dynamics 12:21
Analyze inventory dynamics as stock follows a sawtooth pattern; demand rate governs depletion to the reorder point (ROP), time between orders, replenishment lead time, and average inventory Q/2.
Inventory Dynamics 22:41
Explore how order size and frequency impact inventory levels, demand rate, and replenishment timing, and learn about safety stock and reorder points to prevent stockouts.
Section 8 Quiz

Order Quantity Decisions - Introduction0:50
Explore how much to order by applying the economic order quantity model, the first key decision in inventory purchasing within supply chain and operations.
Economic Order Quantity5:59
Apply the economic order quantity model to minimize total inventory costs by balancing holding costs and ordering costs, using the EOQ formula sqrt(2DS/H).
EOQ Examples4:07
Calculate the EOQ using an ice cream example, balancing ordering costs and holding costs to minimize monthly total cost.
Sensitivity and Limitations of EOQ4:44
The economic order quantity (EOQ) computes near-optimal order size using demand, setup and holding costs, showing insensitivity to small input changes and deriving time between orders from Q/D.
Batch Sizes and WIP3:45
Explore how batch sizes drive work in progress, lead time, and quality risk across manufacturing and services. Compare single item versus mega batches and learn how changeovers and throughput matter.
Economic Batch Quantity (EBQ)3:42
Explore the economic batch quantity model and its setup and holding costs. Analyze its demand-based formula, limitations on lead time and customer delivery, and note alternatives in lean manufacturing.
Order Quantity Decisions - Other Methods1:37
Examine order quantity decisions beyond EOQ, including the price break model, container size constraints, cash availability, and fixed-interval ordering.
Section 9 Quiz

Price Break Model & EOQ3:09
Explore how the price break model extends the economic order quantity by incorporating quantity discounts, ordering costs, holding costs, purchasing costs, and price bands to minimize total cost.
Price Break Model - Example2:10
Compare price break options against the EOQ to minimize total cost, revealing that ordering 5,000 units at $0.90 yields the lowest total cost.
Understanding the PBM Curve2:24
Explore the PBM curve, showing how total cost combines ordering and holding costs across price tiers, with the minimum at 5,000 units and 10,500 total cost.
Price Break Model - Exercise4:18
Apply the price break model to determine the optimal order size by comparing EOQ with quantity discounts, balancing ordering, holding, and purchasing costs to minimize total cost.
Section 10 Quiz

Requirements

Only an appetite to improve yourself and enhance your business
A desire to grow in this fundamental area of Supply Chain Management - from total beginner to a competent professional.
Ready to take control of improving your business operations with powerful principles and tools

Description

This MBA-style course prepares and empowers you to make a REAL difference. Turbo-charge your career, and your business performance, to the highest levels.

This course is for the new or aspiring operations manager, ambitious procurement professionals, striving logistics supervisors, hands-on production planners and practical business optimization analysts.

Take control of your inventory management to have an impact and improve your business operations - manufacturing, services, industrial operations and production.
Equip yourself to take a new leading role in your workplace - improving your processes, systems, business / organization.
Understand the fundamentals and then the essential details of inventory management: the core business trade-offs, analysis, calculations and practical optimisation methods.
Understand how demand forecasting, demand planning and inventory planning connect to better operational decisions.
Build your understanding of Sales & Operations Planning (S&OP), Materials Requirements Planning (MRP) and the wider planning processes that drive inventory.
Become the inventory and supply-chain authority in your team, equipped to improve the operations systems and performance in your business.

Specific Techniques, Concepts and Calculation Methods taught:

Little's Law: Calculate your mathematical minimum WIP for your process
Economic Order Quantity (EOQ): Master this common formula to minimise your total costs
Price Break Model: An advanced EOQ method which lets us consider price discounts with order size
ABC Analysis: Classify and group your inventory to prioritise attention
Performance Metrics: Understand the most important and useful inventory KPIs, including Inventory Turns and Days on Hand
Safety Stock Levels: Calculate and cover your risk using both basic and more advanced statistical methods step by step in Excel
Demand Forecasting: Understand why forecasting matters, forecastability and the main qualitative and quantitative forecasting approaches
Demand Management & Planning: Understand demand variability, how demand can be managed and how better planning supports inventory decisions
Collaborative Planning: Explore CPFR, Vendor-Managed Inventory (VMI), the Bullwhip Effect and approaches to smoothing demand
S&OP: Understand how Sales & Operations Planning connects forecasts with inventory and production plans
Materials Requirements Planning (MRP): Understand how material requirements and inventory planning support production
Inventory Strategy: Understand Make-to-Stock, Make-to-Order, JIT and Postponement and how these choices affect inventory

Business operations come in all shapes and sizes with a host of unique challenges; but good inventory management is essential to them all. Whether you work in retail, manufacturing production, distribution and logistics, or even service companies such as restaurants, hospitality or health and beauty, having the right stock available whilst minimising costs and risk is a fundamental balance that can determine your business's success.

Strong inventory management also depends on understanding the demand that drives inventory. Forecasting, demand planning, ordering decisions and production planning all interact. This course therefore goes beyond simply calculating stock levels to help you understand how inventory fits into the wider planning and operations system.

Gaining control and continuously improving your business operations is essential to remaining competitive: improving profitability, customer experience and customer satisfaction, reducing costs and improving delivery.

Without a solid grasp of inventory, no operations manager, junior or senior, can competently or confidently look to improve their business, the processes, systems and teams that make it successful.

Take control of your career and equip yourself with a solid base in Inventory Management, full of practical insights and tools that you can use right now to unlock the potential of your business processes!

Course Sections:

Introduction to Inventory Management
What is Inventory?
Why do we "need" Inventory?
Costs of Inventory
KPIs, Metrics & Performance Management
ABC Analysis, Demand Types & Parts Segmentation
Summary Quiz 1
Inventory Dynamics
Economic Order Quantity - EOQ
EOQ Advanced: Price Break Model
Order Timing and Inventory Control
Safety Stock Calculations
Demand Forecasting
Demand Management and Demand Planning
Sales & Operations Planning (S&OP), MRP & Inventory Planning
Summary Test 2
Conclusion
Bonus Section

Course Extras

Downloadable Section Summaries
Working Exercises for practical training
Section Quizzes to check your learnings as you go
2x Summary Tests to test and lock in your learning

Take control! Boost your career and your business! Start learning today!

1. Introduction to Inventory Management

Motorbiking "Inventory" down Africa

What is Inventory Management?

Why is Inventory Management Important?

Any Questions

Course Topics

2. What is Inventory?

What Is Inventory? Types, Functions & Locations

3. Why do we "need" Inventory?

Why do we "need" Inventory?

Why Else do we Hold Inventory?

Other "less good" Reasons for Inventory

Little's Law

Little's Law: The Camera Factory

Essential Buffer WIP and Bigger Objectives

4. Costs of Inventory

Costs and Financial View of Inventory

Ordering, Holding & Operational Costs

Scottish Whiskey

Stockouts, Risk & the Inventory Trade-Off

Rock Boat Analogy

5. KPIs, Metrics & Performance Management

Measuring Inventory Performance - Metrics & KPIs

Popular Inventory Metrics: GMROI, Shrinkage & Sell-Through

Inventory Turns and Days on Hand

Control Charts

"Inventory Dollar Days" and "Throughput Dollar Days"

6. ABC Analysis, Demand Types & Parts Segmentation

Part Classification - Introduction

ABC Analysis

Runners, Repeaters & Strangers

Independent vs Dependent Demand

BOM & MRP

7. Summary Quiz 1

Summary Test 1

8. Inventory Dynamics

Basic Inventory Dynamics - Introduction

Inventory Dynamics 1

Inventory Dynamics 2

9. Economic Order Quantity - EOQ

Order Quantity Decisions - Introduction

Economic Order Quantity

EOQ Examples

Sensitivity and Limitations of EOQ

Batch Sizes and WIP

Economic Batch Quantity (EBQ)

Order Quantity Decisions - Other Methods

10. EOQ Advanced: Price Break Model

Price Break Model & EOQ

Price Break Model - Example

Understanding the PBM Curve

Price Break Model - Exercise

11. Order Timing and Inventory Control

Order Timing Decisions - Introduction

When to order?

Continuous Review System

Tracking Inventory Levels

Passive Inventory Control - Pull

Inventory Position

Inventory Position - Exercise

12. Safety Stock Calculations

Safety Stock - Introduction

Why Safety Stock?

Calculating Safety Stock - Simple

Calculating Safety Stock - using Statistics

Normal Distributions and Standard Deviation

Choosing your Service Level

Calculating Safety Stock - Example

Calculating Safety Stock - Example 2

Safety Stock Summary

Safety Stock - Take it further

13. Demand Forecasting

What Is a Forecast?

Demand Forecasting: Why Do We Need it?

Forecast Accuracy & Forecastability

Demand Forecasting Methods: Qualitative & Quantitative

14. Demand Management and Demand Planning

Demand Planning for Inventory Management – Introduction

What Is Demand Management?

Causes of Variability and Uncertainty of Demand

Internal and External Demand Management

Influencing Customer Ordering Behaviour

Collaborative Forecasting, CPFR & the Bullwhip Effect

Vendor-Managed Inventory (VMI)

Demand Smoothing Through Operational Improvement

Make-to-Stock vs Make-to-Order, JIT & Postponement

15. Sales & Operations Planning (S&OP), MRP & Inventory Planning

Sales & Operations Planning (S&OP): What It Is & Why It Matters

S&OP Planning Structure: From Forecast to Inventory & Production Plan

Materials Requirements Planning (MRP) & Inventory Planning

16. Summary Test 2

Summary Test 2

17. Conclusion

Conclusion

18. BONUS SECTION

What's Next? - Further Reading

Your Certificate - How to Download, Modify & Share it

"I Can't Get My Certificate!"

Bonus Lecture - My Other Courses & Connection

Take control! Boost your career and your business! Start learning today!

All the inventory you could possibly need! :)

See you on the inside!

Laurence

Who this course is for:

Supply Chain, Operations and Production Managers in Manufacturing or Service Businesses
Logistics, Purchasing and Procurement Professionals
Financial Controllers, Accountants, Business Analysts & Consultants
Small Business Owners & Operations Managers
Ambitious Self-Starters who want to have a Bigger Impact at work, Improve Things and Get Noticed
Demand Planners, Material Planners and Production Planners
People working in Production, Manufacturing, Industrial Operations, Business Operations
MBA / Business School Students looking to Propel their Career

Inventory Management A-Z: Supply Chain & Business Operations

What you'll learn

Explore related topics

Course content

Introduction to Inventory Management5 lectures • 19min

What is Inventory?1 lecture • 7min

Why do we "need" Inventory?6 lectures • 34min

Costs of Inventory5 lectures • 32min

KPIs, Metrics & Performance Management5 lectures • 28min

ABC Analysis, Demand Types & Parts Segmentation5 lectures • 14min

Summary Quiz 10

Inventory Dynamics3 lectures • 6min

Economic Order Quantity - EOQ7 lectures • 25min

EOQ Advanced: Price Break Model4 lectures • 12min

Requirements

Description

Who this course is for: