What are the disadvantages of periodic systems for controlling inventory?
The disadvantages of periodic while compared to continuous systems for controlling inventory are as follows:
a. Could be vast disruption at specific intervals for example, at the financial year ending to production flow, anything may require to stop to make sure a good cut off point for stock to be actually verified.
b. It could less control over stock since missing or obsolete items might not be identified often adequate.
c. More probable that outsized errors or discrepancies will be discovered while physical stock is counted and compared along with any stock records kept.
d. Higher risk of stock outs happening when stock levels are not reviewed often.
e. However periodic can be allot easy and less complex like a system to keep.