Average Payment Period for Production Materials

An inventory management approach that prioritizes products based on their classification in the ABC analysis, focusing more resources on the most valuable items.

A cost management system that tracks financial and operational data on resources, activities, drivers, and measures. ABC models are created and maintained within this system.

Just-in-Time (JIT) inventory is a strategy where businesses seek to reduce inventory costs by receiving goods only when they are required for production or sale. Instead of holding large stocks of raw materials or finished goods, companies use JIT.

Stock that is accumulated in advance of expected peak demand periods, seasonal sales, or known future events to ensure adequate supply and meet customer needs.