Advantages And Disadvantages Of Just In Time

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INTRODUCTION In turn of wheel now, 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 method requires that producers are able to accurately forecast demand. Apart of that, Just-in-Time" means making "only what is needed, when it is needed, and in the amount needed." For example, to efficiently produce a large number of automobiles, which can consist of around 30,000 parts, it is necessary to create a detailed production plan that includes parts procurement. Supplying "what is needed, when it is needed, and in the amount needed" according to this production plan can eliminate waste, inconsistencies, and unreasonable requirements, resulting in improved productivity. Furthermore, Just in time inventory is intended to avoid situations in which inventory exceeds demand and places increased burden on your business to manage the extra inventory.…show more content…
Apart from that, There is a high reliance on suppliers, whose performance is generally outside the purview of the manufacturer. Therefore, the companies Due to there being no buffers for delays, production downtime and line idling can occur which would bear a detrimental effect on finances and on the equilibrium of the production process. However, The organization would not be able to meet an unexpected increase in orders due to the fact that there are no excess finish goods. Furthermore, Transaction costs would be relatively high as frequent transactions would be made. Lastly, Just-in-time manufacturing may have certain detrimental effects on the environment due to the frequent deliveries that would result in increased use of transportation, which in turn would consume more fossil
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