What is a major implication of having excess equipment in inventory?

Having excess equipment in inventory significantly contributes to higher maintenance costs. This is because each piece of equipment requires upkeep, parts, and inspections, leading to increased spending on repairs and maintenance resources. When the inventory exceeds operational needs, organizations may need to invest more in maintaining, tracking, and storing unnecessary equipment, which diverts resources from other critical areas.

Higher maintenance costs can strain budgets and reduce overall efficiency, as funds that could be used for other essential functions are tied up in managing unnecessary inventory. In contrast, effective inventory management aims to balance equipment levels to minimize these costs while ensuring mission readiness.