Inventory deterioration

Inventory deterioration is a decline in the physical condition or usable life of items while they are held. Perishable materials can expire or degrade even when demand is unchanged; obsolescence instead concerns loss of usefulness or demand, for example after a product redesign. Appropriate storage, rotation, inspection and purchase quantities reduce exposure, but management must still identify unusable items and investigate causes. Physical quantity records alone do not establish that all recorded stock is fit for use.