Stock is the raw materials, part-finished goods and finished products a business holds. A retailer's stock is the goods waiting to be sold.

What are the advantages of just in case stock control?

A business can meet unexpected demand without running out. A business can also buy in bulk and gain purchasing economies of scale.

What are the costs of holding buffer stock?

Stored stock ties up cash that could be used elsewhere. Storage space, insurance and security cost money, and stock may be damaged or go out of date.

How does just in time stock management work?

A business holds almost no stock and orders supplies to arrive exactly when needed. Deliveries are small and frequent.

AQA GCSE Business 8132

Business in the Real World

Topic overview What a business is and why people start one Goods, services, needs, wants and factors of production Business sectors, entrepreneurs and a changing business environment Sole traders, partnerships, limited companies and not-for-profit organisations Business aims and objectives Why business objectives differ and change Stakeholders and their influence on businesses Factors affecting business location Business planning and basic financial terms Expanding a business and economies of scale

Influences on Business

Topic overview E-commerce and digital communication Ethics, the environment and sustainability Interest rates, employment and consumer spending Globalisation and exchange rates Employment, health and safety and consumer law Competition, risk and uncertainty

Business Operations

Topic overview Job, flow and lean production Managing stock: just in time and just in case Suppliers, procurement, logistics and supply chains Quality control, quality assurance and TQM Customer service and the sales process

Human Resources

Topic overview Organisational structures, span of control and delegation Recruitment, selection and contracts of employment Financial and non-financial methods of motivation Induction, on-the-job and off-the-job training

Marketing

Topic overview Identifying and satisfying customer needs Market segmentation Purpose of market research and primary and secondary research Market research methods and interpreting findings Pricing methods and factors affecting price New products, USP, brand image and the Boston Matrix Product life cycle and extension strategies Promotional methods and the promotional mix Channels of distribution, e-commerce and m-commerce The integrated marketing mix

Finance

Topic overview Sources of finance Cash flow and cash flow forecasts Financial calculations and average rate of return Break-even charts and margin of safety Income statements and statements of financial position Profit margins and judging financial performance

Business Operations

Managing stock: just in time and just in case

3 things to know
Paper 1

Overview

Just in case stock and buffer stock, the costs of holding stock, how just in time works and depends on suppliers, lost bulk-buying discounts, and cases from sandwich shops to hospitals.

What you need to know

Answer each one before you reveal it.

Your recallNot started

Key term

What is stock?

Key term

What is just in case (JIC) stock control?

Key term

What is buffer stock?

Questions from this subtopic

Each one with the model answer underneath.

1
What is stock?
Model answer
Stock is the raw materials, part-finished goods and finished products a business holds. A retailer's stock is the goods waiting to be sold.
2
What is just in case (JIC) stock control?
Model answer
Just in case means holding spare stock in case demand rises or deliveries are late. The business can always meet orders.
3
What is buffer stock?
Model answer
Buffer stock is extra stock held for emergencies, such as a sudden rise in demand. Buffer stock stops production or sales halting if supplies run short.
4
What are the advantages of just in case stock control?
Model answer
A business can meet unexpected demand without running out. A business can also buy in bulk and gain purchasing economies of scale.
5
What are the costs of holding buffer stock?
Model answer
Stored stock ties up cash that could be used elsewhere. Storage space, insurance and security cost money, and stock may be damaged or go out of date.
6
How does just in time stock management work?
Model answer
A business holds almost no stock and orders supplies to arrive exactly when needed. Deliveries are small and frequent.

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Business in the Real World

Influences on Business

Business Operations

Human Resources

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The pays a fee and a share of revenue.

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