Raw materials – required inventory of materials that are processed into the product.

WIP- is required it is when raw materials are being shaped into finished goods but not quite finished yet

Buffer inventory – serves as a mask for uncertain problems that arise for example a shipment gets in a wreck so they can use buffer inventory to cover.

Decoupling inventory – serves as a buffer between machines for example a machine builds up parts for the next process that way in case the line goes down they still can have inventory on hand to produce the parts.