Inventories are materials stored, waiting for processing, or experiencing processing. They are ubiquitous in modern business. Observation of almost any company balance sheet reveals that a very significant part of its assets comprise inventories of raw materials, products within the production process, or finished products.

Because of their practical and economic importance, the subject of inventory control is a major consideration in many situations. Questions must be constantly answered as to when and how much raw material should be ordered, when a production order should be released to the plant, what level of safety stock should be maintained at a retail outlet, or how in-process inventory is to be maintained in a production process. These questions are amenable to quantitative analysis through the subject of inventory theory. This add-in embodies some of the mathematical results of inventory theory.

Inventory models all involve some level of abstraction from reality. The first abstraction removes all statistical variability from the situation. Thus we call these models deterministic. The next page considers the single product deterministic models.