Videos [3:48 + 2:17 min]: What is Inventory Management? & Amazon Inventory Management

Synopsis: Inventory management requires an effective combination of financial and operational expertise to ensure revenue is greater than expenditures.

As stated in Section 16.2, the cost of inventory includes its purchase price, plus ordering, handling, storage, interest, and insurance costs. Watch the first video for a brief summary of the various components of the inventory management process. Hopefully you will note from watching this first video all the areas where managers must decide how best to use organizational funds to achieve successful movement and management of inventory, including investments in systems, machinery and staff.

Next, view the second video which showcases one of Amazon’s warehouses. Although this video is a few years old, it does display a balance of both human and non-human touch-points along the way to getting a package out the door. Which processes do you think must be manual, or could this warehouse become 100% automated at some point?

One fascinating aspect of the “SLAM” line described in the video is the ability of Amazon’s computerized labeling and shipping apparatus to know the anticipated package weight and thus detect the likelihood of pulling the wrong item since the package apparently had an incorrect weight. Was there anything else about Amazon’s inventory and shipping procedure that seemed interesting or unusual to you?