The stock level of an item means that an item is in stock with planned stocks. The purpose of such planned stock is to be able to cover the requirements of a customer or the company’s own production immediately, at least in part. For stocked items, it is important to plan the required stock correctly using a correct safety stock and the correct MRP settings and MRP procedures.
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An item is not considered to be in stock just because it is currently or even regularly in stock. Such stocks can also arise because items have to be ordered with rounding or minimum quantities that are larger than the actual requirement, because rejects were lower than expected or because an excess quantity was produced. Inventory controlling should differentiate between the inventory for stocked items and the inventory for non-stocked items. The stock of non-stock items should be kept as low as possible and the causes of stock build-up should be identified and eliminated wherever possible.
