Understanding Stock vs Inventory in Asset Management

Stock generally refers to the goods or materials that a business will hold for the purpose of resale to customers. Stock is the merchandise a company buys, stores, and sells. Its stock may include final goods, such as the products in a retail store, or components that are meant for further processing of a final product, like the parts over which a manufacturer may exercise control for use in an assembling process.

Take the instance of a fashion store; the shirts, jeans, and accessories are all in stock, though one might add them to certain display counters in the backroom. All of these are purchased from various suppliers and are meant to be sold to the clientele. Once it gets sold off, it ceases to be in the stock, but the stock is regularly replenished in order to be able to keep up with the demand.