Warehouse increases the inventory it has for various reasons:
1. It helps in managing products: By increasing inventory, a warehouse can ensure that it has a sufficient stock of products to meet customer demands. This can help prevent stockouts and backorders, improving customer satisfaction and loyalty.
2. It helps in meeting the expected demand: Increasing inventory levels can enable a warehouse to meet fluctuating demand levels. By having more products on hand, the warehouse can respond quickly to changes in demand without delays.
3. It helps in controlling costs: While increasing inventory can tie up capital, having the right amount of inventory can also help in reducing costs associated with rush orders, expedited shipping, and production disruptions due to stock shortages.
In conclusion, warehouses increase their inventory to effectively manage products, meet expected demand, and control costs, ensuring smooth operations and customer satisfaction.
