Question

Describe the lifecycle of an inventory item in a merchandising business.

Answer 1

Merchandising business is a business that purchases finished products and resells them, generally for a higher price than they were purchased. There are two types of merchandising companies - retail and wholesale.

If the inventory nature is of basic necessities of life then life cycle of that inventory is very moving i.e. movement of good is very fast. for example Milk, matchbox etc.

If the inventory is used rarely then the life cycle of that inventory is very slow moving.

If the product is used seasonally then the movement of that product is very good but only for that particular season.