EXCESS STOCK POSITION. LMI REF. NO. S3.

The retention of excess stocks at any level of supply reduces efficiency and performance, and increases cost. Such stocks must receive care and preservation, require man-hours for record keeping and accounting, and utilize storage space frequently needed for operating stocks. Perhaps even more important, such stocks are not available to other users who may have a valid requirement for them. Finally, excess stock funded items represent an investment of operating capital which may, in some instances, be recouped through return to the stock fund. This action releases operating funds to meet other priority requirements. Author