Question
A factory produces goods in large batches and stores
them in warehouses for months before sale, leading to high storage costs and obsolescence. Under Lean philosophy, this situation primarily represents which type of waste?Solution
In Lean philosophy, Inventory waste refers to excess products and materials being held that are not currently required to satisfy customer orders. The scenario describes several symptoms of inventory waste:
- Excessive Batches: Producing in large batches often exceeds immediate demand, forcing goods into storage.
- Holding Costs: Storing goods for "months" leads to high costs for warehouse space, utilities, and labor.
- Obsolescence: Items kept in storage for long periods risk becoming outdated or unsellable, which is a direct consequence of excess inventory. s
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