The main purpose of inventory management is to make sure that stock levels of both raw materials, Work-in-Process, and finished goods inventories are always kept at an optimum. As such, inventory management attempts to avoid two extremes – overstocking and stockouts, from occurring, as both of these can be hugely detrimental to the financial and operational health of a company. Additionally, inventory management is also aimed at minimizing overhead costs, increasing manufacturing or distribution efficiency, and ensuring compliance by way of stock traceability.