CPIM Practice Exam

Which type of inventory is most affected by delivery delays and quality issues?

1. Service parts

2. Transportation inventory

3. Fluctuation inventory

4. Cycle stock

The correct answer is: Transportation inventory

Transportation inventory is significantly impacted by delivery delays and quality issues because this type of inventory represents the goods that are in transit between locations, such as from suppliers to warehouses or from warehouses to customers. Transportation inventory is particularly vulnerable since any disruptions in the transport process can lead to longer lead times and potential shortages. Delays in delivery directly affect the availability of products for customer demand, and quality issues during transit can necessitate returns or replacements, further complicating inventory management. Other types of inventory, such as service parts, fluctuation inventory, and cycle stock, are influenced by different factors. Service parts are generally held to maintain equipment and support services, while fluctuation inventory accounts for variability in demand. Cycle stock pertains to inventory that is replenished in regular cycles based on established demand patterns. These types may not be as directly affected by the immediate external challenges posed by delivery and quality as transportation inventory is.