Inventory reduction is often portrayed as a major reason for investing in advanced manufacturing technology (AMT), especially in the literature about just-in-time GIT) and logistics. Unfortunately, much of what is written can be misleading because it is often based on oversimplified assumptions. Some authors even confuse the high ongoing cost of the material content in products with the cost of inventory, believing that reducing inventory will lead to lower material costs. While reducing material costs will reduce the value of inventory, reducing inventory levels will have little or no effect on the cost of material content.