The practice whereby a manufacturer has inventories of materials on consignment from its suppliers falls under the scope of vendor-managed inventories.
In a Vendor-Managed Inventory (VMI), the manufacturer decides the inventories of materials on consignment from its suppliers. This inventory model is beneficial to the vendors as wells as the customers. Here, even though the manufacturer (Vendor) is the decision-maker, it is made by analyzing the information provided by the buyer through the suppliers.
This inventory model lowers the cost of manufacturing and makes profit. Also it provides an closer customer-manufacturer relationship.
Learn more about vendor-managed inventories at https://brainly.com/question/13979845
#SPJ4