STRATEGI MINIMALISASI NILAI PROVISI MATERIAL TERHADAP HEALTHY INVENTORY

Abstract

Healthy inventory is an indicator of a company's financial well-being. An unbalanced inventory will cause company chaos in the form of too much inventory, or not enough inventory, both of which can destroy the revenue of a company. There are many great challenges to be faced in controlling the proper inventory. When a company has an inventory level that is too large, it will result in the emergence of large capital embedded in inventory, increased storage costs, and the risk of damage or loss of goods. However, if the company has too little inventory, it will result in the risk of a shortage of inventory (stockout) because not all materials/goods can be imported suddenly and as much as needed considering the capacity and waiting time at the supplier, thus allowing for additional costs when bring in the goods by making special deliveries so that the goods can arrive faster, so that this shortage of inventory can cause the production process to stop, sales delays, and even the loss of customers. The risk of excessive and piled up inventory will potentially expire, be damaged, or lost and all of these risks will lead to potential additional costs that are included in the cost of material provisions. All cost estimates related to existing inventory levels due to miscalculations will be provision costs that must be borne by the company. The cost of this provision will cause a loss and will automatically reduce the profit generated, so many companies will make various strategies to avoid the cost of this provision.