Organization’s inventory is an important component and its management is vital to the success and cost reduction of the firm’s expenditure. Wild, (2002) recommends, proper warehousing of inventory so that when goods are ordered, they are held at the warehouse for the least time possible minimizing holding cost of inventory. Consequently, other operational costs may increase inventory management costs like through the balance of ordering costs, holding costs, safety stock and stock outs (Palevich, 2012) and (Wisner, Tan and Leong 2011). Once an organization realizes this, it can develop online inventory management tool to monitor its inventory information by breaking it down into groups by correlating the categories with its customers.
Beamon and Kotleba (2006) explain that Re-order level (ROL) is critical for humanitarian organizations to achieve optimal efficiency and be effective. They need to have two reorder levels one that is normal whereas a second one that is for emergency cases in case of disaster. This improves performance and customer satisfaction. Bachetti, Plebani, Saccani and Syntetos (2010) argue that inventory management need to be organized in a logical way to facilitate the organization knowledge of when to order and quantity to order.
Economic order quantity enables organizations plan their inventory replenishment on a timely basis such as monthly, quarterly, half yearly or yearly basis. As organizations try to improve on the inventory management, Economic Order Quantity (EOQ) and Re-order Point (ROP) are important tools organizations can use to ensure that inventory supply does not hit a stock out as explained by Gonzalez and Gonzalez (2010). Just-in-time (JIT) contributes grea