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Inventory holding cost comprises of the following, which is the biggest one? 1 Rent 2 Mat Handling 3 Labor cost 4)Cost of capital 5) Scrap cost

Inventory Management
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Question added by Vaseem Ahamad , Associate Director Operations , Perfetti Van Melle
Date Posted: 2016/02/28
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ARUN KUMAR
by ARUN KUMAR , Operation Manager , Bikanervala

COST OF CAPITAL comprises the biggest part in inventory management

Vaseem Ahamad
by Vaseem Ahamad , Associate Director Operations , Perfetti Van Melle

Break up of holding cost 

 

Housing cost ( Rent ) - 6%

Material handling cost - 3%

Labor cost - 3%

Inventory investment cost ( cost of capital) - 11%

Pilferage / scrap and obsolescence - 3%

 

Total                                         -26%

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