What is a characteristic of continuous review inventory systems?

In continuous review inventory systems, inventory levels are monitored continuously to determine when to reorder stock. This approach allows for immediate reordering when inventory falls below a predetermined threshold or reorder point. By continuously tracking inventory levels, businesses can react promptly to changes in demand or supply chain disruptions, thereby minimizing stockouts and excess inventory costs.

This characteristic distinguishes continuous review systems from periodic review systems, where inventory levels are checked at fixed intervals, meaning decisions to reorder are made based on a specific review schedule rather than real-time data. Additionally, while daily monitoring could be a part of a continuous system, the crucial feature is the ongoing aspect of assessment and management, not the frequency of checking. Thus, the correct answer highlights the ongoing nature of monitoring inventory levels, essential for effective stock management in dynamic environments.