How can carrying inventory protect against stockouts balance

How can carrying inventory protect against stockouts, balance supply/demand, and protect against uncertainty?

What are the consequences of not carrying inventory?

Solution

Inventory carrying has been a very strategic decison for businesses from many years now. All the points mentioned in the question rightly justifies the use of having inventory in hand. Companies can tackle the demands with inventory even if the production is low, company can tackle the market uncertainities which can be becuase of any micro or macro economic factors hence inventory can make or break the company.

Consequences of not carrying inventory can be:

1) Loss of market share
2) Unsatisfied customer
3) Lost credibility
4) Rivals may enter because of your absence from the market.

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