Just-In-Time (JIT)
An inventory and supply chain strategy where materials and components are delivered to a manufacturing or assembly facility exactly when they are needed in the production process, minimizing inventory holding costs and warehouse space requirements. JIT relies on precise scheduling, reliable transportation, and close coordination between suppliers and manufacturers. While JIT reduces costs, it makes the supply chain more vulnerable to disruptions.
Detailed Explanation
An inventory and supply chain strategy where materials and components are delivered to a manufacturing or assembly facility exactly when they are needed in the production process, minimizing inventory holding costs and warehouse space requirements. JIT relies on precise scheduling, reliable transportation, and close coordination between suppliers and manufacturers. While JIT reduces costs, it makes the supply chain more vulnerable to disruptions.
Example
An auto assembly plant in Tennessee receives daily JIT deliveries of seats, dashboards, and wiring harnesses timed to arrive within 2 hours of when they are needed on the production line, keeping only 4 hours of inventory on hand.
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