Inventories of finished products exist in each stage of the channel between production and consumption. An inventory has several functions, which make it possible to produce by economic lot size and to elevate services for consumer by shortening delivery time, etc$cdots$. Finished products may be inventoried in delivery-center as well as at the plant where production takes place. So, finshed products must be dealt with as multistage inventory problem, because an inventory functions differently according to its place. The purpose of this study is to determine how much to carry in stock and what stage to carry Though there may be several channels between production and consumption, this study deals with only one main channel, that is, series of ncomponents and determines the optimal inventory policy by introducing the concept of selling probabilities.