This paper examines the inventories of publicly traded American manufacturing companies between 1981 and 2000. The median of inventory holding periods were reduced from 96 days to 81 days. The average rate of inventory reduction is about 2% per year. The greatest reduction was found for work-in-process inventory, which declined by about 6% per year. Finished-goods inventories did not decline. Firms with abnormally high inventories have abnormally poor long-term stock returns. Firms with slightly lower than average inventories have good stock returns, but firms with the lowest inventories have only ordinary returns.inventory, just in time, supply chain, manufacturing

This paper examines the inventories of publicly traded U.S. retail and wholesale companies between 1981 and 2004. First, we document that inventory holdings have been reduced. The median of wholesale inventory holding periods was reduced from 73 days to 49 days. Retail inventory did not start to decline until about 1995. Second, we document that firms with abnormally high inventories have abnormally poor long-term stock returns. Third, we illustrate these effects for the cases of Wal-Mart, 7-Eleven (Japan), and some related firms.inventory, retail, wholesale, stock returns, empirical analysis

The value of seasonal energy storage depends on how the firm operates storage to capture seasonal price spreads. Energy storage operations typically face limited operational flexibility characterized by the speed of storing and releasing energy, which makes the optimal policy, in general, difficult to compute. A widely used practice-based heuristic, the rolling intrinsic (RI) policy, generally performs well compared with an optimal policy but can significantly underperform in some cases. In this paper, we aim to understand the gap between the RI policy and the optimal policy and leverage the resulting insights to improve the RI policy. A new heuristic policy, the price-adjusted rolling intrinsic (PARI) policy, is developed based on theoretical analysis of storage options. This heuristic adjusts certain prices before applying the RI policy to provide the RI policy with estimates of the values of various storage options. We evaluate the performance of the RI and PARI polices using actual data from the natural gas industry. Our results show that, on average, the PARI policy recovers about 67% of the value loss of the RI policy. Furthermore, when the value loss of the RI policy is larger, the PARI policy tends to recover a higher fraction of that value loss.