The term inventory means material kept in store for smooth functioning of business or to be used in production process in future. Inventory is an aggregate of those items of tangible personal property which are held for sale in ordinary course of business, are in the process of production of goods and services. Investment in inventory occupies a very significant place in the current assets or working capital of most of the organization. Thus, it is necessary to have a proper control or inventory management. There is a very prominent saying by a scholar John Bye Jell. “Material kept in store for sale in future or to be used in production process is known as inventory. The main aim behind inventory management is to use the inventory efficiently in order to keep the enterprise competitive in the market. Along with this inventory management also aims at enhancing the productivity of capital, maintain regular supply of finished goods, ensure continuous flow of production and prevent fluctuation of production process and so on.