Stock sitting in a warehouse is both an asset and a cost. Inventory is the total quantity of goods held by a business for sale, production, or maintenance.

It includes raw materials, work-in-process, and finished goods. Holding inventory buffers against demand spikes and supply delays, yet it ties up capital and risks obsolescence or damage. Accountants value it; operations managers position and move it.

Accuracy of inventory records determines whether customer promises can be kept. Cycle counting and system transactions aim to keep book stock aligned with physical stock. Every logistics decision—from order quantity to network design—eventually touches inventory.

• Stock of goods held by a business
• Includes raw materials, WIP, and finished goods
• Balances service levels against holding cost
• Requires accurate records for reliable fulfillment