Inventory management is the backbone of the production system. As it monitors the material and resources. Inventory is quantities of goods in stock. This is true for any product, material, or good. Consider the books or CDs on your bookshelf. They comprise an inventory of books. They provide you with a certain value from enjoying them to the monetary value you paid for them. They cost money to purchase—money that cannot be used for something else. The same is true for inventory companies hold in stock. When we talk about inventory we are simply talking about quantities of materials a company has in storage. This material serves many purposes, but it also ties up a great deal of funds.