Just-in-Time (JIT) Inventory
JIT is a management philosophy that strives to eliminate sources of manufacturing waste by producing the right part in the right place at the right time.
Waste results from any activity that adds cost without adding value, such as moving and storing.
JIT (also known as lean production or stockless production) should improve profits and return on investment by reducing inventory levels (increasing the inventory turnover rate), improving product quality, reducing production and delivery lead times, and reducing other costs (such as those associated with machine setup and equipment breakdown).
Over the last ten years, virtually every company has taken steps to reduce costs associated with holding inventory. The challenge in making appropriate inventory decisions is to clearly understand all the costs associated with holding inventory. Tubular Steel has created this inter-active worksheet to help assess inventory carrying costs using data collected from hundreds of businesses.
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