Advantages Of Just In Time

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The literary meaning of just in time is denoting a manufacturing system in which materials or components are delivered immediately before they are required in order to minimize inventory costs. Definition: Just in time (JIT) inventory is a management system in which materials or products are produced or acquired only as demand requires. An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs. This approach to managing inventory has become increasingly popular in the early 21st century as suppliers and retailers collaborate to try to control inventory costs while still meeting customer demands. The Introduction of (JIT): When first…show more content…
The company many need to slash prices on that unsold inventory just to get rid of it, which can reduce the perceived value of the firm's other products. The just-in-time inventory model reduces this waste and helps the company respond more quickly to what its customers need. The advantages and disadvantages of just-in-time inventory: There should be minimal amounts of inventory obsolescence, since the high rate of inventory turnover keeps any items from remaining in stock and becoming obsolete. Since production runs are very short, it is easier to halt production of one product type and switch to a different product to meet changes in customer demand. Less inventory can be damaged within the company, since it is not held long enough for storage-related accidents to arise. Also, having less inventory gives materials handlers more room to maneuver, so they are less likely to run into any inventory and cause damage. Production mistakes can be spotted more quickly and corrected, which results in fewer products being produced that contain defects.

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