Certified Supply Chain Professional (CSCP) Practice Exam

Which of the following factors does NOT impact inventory costs?

1. Storage expenses

2. Employee salaries

3. Transportation costs

4. Production redesign

The correct answer is: Production redesign

The correct choice signifies that production redesign does not directly impact inventory costs in the same way that the other options do. Inventory costs are typically comprised of elements such as storage expenses, employee salaries associated with managing inventory, and transportation costs incurred when moving inventory between locations. While production redesign might have indirect impacts on the overall operation or efficiency of the supply chain, it does not target the specific costs associated with holding and managing inventory. For instance, production redesign could lead to changes in production processes or efficiencies that might ultimately affect the lead time or cost structures in the long run, but it isn’t an immediate or direct factor in the calculation of inventory costs. In contrast, both storage expenses and transportation costs are straightforward components of inventory expenses, reflecting costs for space and logistics required to handle the inventory. Employee salaries directly linked to inventory management also contribute to inventory costs since they are directly involved in the process of overseeing inventory levels, stock replenishment, and logistics.