Just in Time (JIT) manufacturing is a business management strategy that focuses on reducing waste and maximizing efficiency by producing only what is needed, when it is needed. It was first conceived in Japan in the early 1960s and has since been adopted by companies around the world. It can be used to produce any product or service.
Companies use JIT to improve their operational effectiveness and efficiency by reducing inventory costs and decreasing the time between placing an order and receiving goods or services.
Just in Time method is needed when a company has the following characteristics:
- The company is operating in a volatile or unpredictable market.
- The company has a high level of inventory and wants to reduce it.
- The company has limited storage space and wants to reduce it.
Just in Time is a manufacturing strategy that seeks to eliminate waste by producing only the exact amount of materials needed at any given time. It is a form of lean manufacturing that focuses on eliminating excess inventory and reducing costs.
While this approach can be beneficial for many businesses, it's not appropriate for every situation. In some cases, it may be more efficient to have a larger amount of inventory on hand than to produce small batches as needed. For example, if you're running an e-commerce business and need to ship products out quickly without having any extra stock sitting around, then just-in-time could be an effective strategy for you.
When Just in Time method is needed:
- When inventory costs are too high.
- When there is a high risk of obsolescence.
- When there is a need for fast response to customer demand.