Which distribution system requires the using department to perform its own inventory?

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The choice of demand distribution system is characterized by its reliance on the using department to manage its own inventory levels. In this system, items are ordered based on actual usage, meaning that departments must closely monitor their consumption patterns and place orders accordingly to ensure they have the necessary supplies on hand. This approach promotes efficiency, as it helps minimize excess inventory and associated holding costs while allowing departments to respond to their specific needs in a timely manner.

In contrast, just-in-time distribution focuses on receiving goods precisely when they are needed, which also involves a certain level of inventory management on the part of the using department. Par level systems, however, set predetermined stock levels for items that need to be maintained. When stocks fall below these levels, reordering occurs automatically to restock the inventory, reducing the burden on the department to monitor and manage their inventory actively.

Thus, the demand distribution system stands out as the correct answer because it explicitly requires the using department to take responsibility for its inventory management, making it integral to their operational practices.

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