JIT Case Study

The JIT approach to manufacturing involves timing the delivery of resources so that they arrive just when needed. Inventory optimization models help the firm determine how many of which items in which sizes should be delivered to each specific store during twice-weekly shipments, ensuring that each store is stocked with just what it needs. Trucks serve destinations that can be reached

It is becoming apparent that the ever changing environment in the global marketplace requires a swifter response time from businesses and their supply chains. The era when production was moved overseas, so businesses can take advantage of low-cost labor is coming to an end, because businesses are not only competing on price but also on time. The owner of Zara, a Spanish clothing store knows this first hand, and has turned supply chain management on its ear, making his company the “envy of the industry” (Ferdows, Lewis, & Machuca, 2004).

The business idea of Zara is to link customer demand to manufacturing, and to link manufacturing to distribution. And based on this general idea, Zara has several essential elements for its business model. First, speed and decision making, which means that in the external level, Zara need to respond very quickly to demands of target customers, and always keep in style. While for the inside, Zara treasure intelligence and judgment of common employees who enjoy a great deal of autonomy. Second, its marketing, merchandising and advertising strategy. Zara does not spend on virtually advertising, while it spends heavily on stores, and no selling online because of

JT is at risk for falls because of his bik ak amputation. When transferring him the nursing staff have to keep in mind that he does have an inability to balance himself making transfers more difficult.. Also they should precaution that he could roll out of bed.

A Co-founder and managing partner of an insurance consulting agency since 1988. He was concurrently a general manager of a firm that publishes children’s educational products. In 2008, Jix relinquished his managing role to pursue his passion in inspiring people through training and talks. He has engaged with Institute for Adult Learning (IAL-WDA) as principal consultant and adjunct adult educator. And with several other organizations as training consultant, skills mentor; and training associate. He holds a Master of Training and

There vertical integration allows small batches of produce to be distributed and tested out allow them to save more money and cut inventory backlogs. Zara maintains a low cost by avoiding outsourcing (where possible) and producing all its merchandise and produce in home soil in Spain. Also Zara own many fabric dying, cutting and processing equipment that provided Zara added control and flexibility to adopt new trends on demand. Effectively Zara is able to design and manufacture products as well as deliver them in less than two weeks in contrast to competitors such as Benetton and H&M which require at least between five weeks and 4 months lead time to fill orders from its retail operations. One major unique characteristic was that Zara own its in house production which gives Zara the flexibility of quantity, variety, and the frequency of the designs they produce.

-Since Zara has a short lead time for delivering products, it keeps no buffer stock and most, if not all, logistics arrangements were centralized at the head office in La Coruna. This makes Zara very vulnerable to accidental incidents.

Zara’s strategy is to offer cutting edge fashion at affordable prices by following fashion and identifying which styles are “hot”, and quickly getting the latest styles into stores. They can move from identifying a trend to having clothes ready for sale within 30 days (whereas most retailers take 4-12 months). This is made possible by controlling almost the whole garment supply chain from design to retail.

JB Hunt’s equipment dwell –Still pushing to decrease total inventory despite of age. Chassis and container inventories are a little skewed. Ran very low of chassis in the far Northeast, very heavy at HBG/RUTH, and Chicagoland holding empties out every weekend to protect loads then back to large chassis surplus during the week. Still monitoring, Walmart over the past few weeks has no increased. Oldest empties at Toledo due to large amount of empties there and some being buried. Same as of last time Dwell with the Walmart loads do not seem to be increasing, currently (this week) the late trains are causing missed appointments adding to the dwell issue.

Zara's short lead-time gives a higher chance for a more accurate predicting the next fashion. This makes them able to meet the customers demand and offer a higher level of fashionable clothes in their

In comparison to competitors, Zara’s business strategy, in regards to strategic partnerships and cost of production, provide for a strategic competitive advantage. Zara, unlike its competitors such as Gap, Benetton, and H&M, does not use Asian outsourcing. Eighty percent of Zara’s materials are manufactured in Europe, with 50% made in Zara controlled facilities in the Galicia region of Spain near headquarters. Most of Zara’s competitors have 100% outsourcing to cheap Asian countries. Though the cost of production in Spain is 17-20% more expensive than Asia, Zara does have a competitive advantage over its competitors in regards to operations. The local strategic partnerships that Zara maintains with manufacturers in Europe allow for a product throughput time of 3-4 weeks from conception to distribution. To make this happen, the company designs and cuts its fabric in-house and it acquires fabrics in only four colours to keep costs low. The proximity of these suppliers gives Zara great flexibility in adapting their product lines based on up to date market trends and consumer behaviour. It also decreases costs of holding inventory. Zara’s competitors, through outsourcing to Asian countries such as China, sacrifice the benefits of proximity for low labour and production costs.

Quick response of Zara leads it to be successful in the fashion clothing industry. Zara adopts international strategy for its operation. With vertical integration, it benefits Zara in cost aspect, however, it involves some risks. Due to our anaylysis on Zara’s operations, some of the recommendations are made to facilitate its further improvements.

The underlying factors in the traditional approach of order fulfillment had a direct impact on manufactures and retailers in the form of thinning margins. Thus, to address these factors an alternative approach of product delivery was crucial and also to take costs out of distribution channel without compromising service. This was introduced by Brando Vitali’s JITD (Just-In-Time-Distribution) proposal, which focused solely on dry products to be sold through distributors. This approach was also expected to radically change the way in which Barilla’s logistics managed product delivery with JITD bringing in its two key concepts of: replacing sequential optimization with global optimization and eliminating some of the “false” economies that drive traditional ordering processes.

A just-in-time system can only exist in an atmosphere where suppliers are reliable and will work to minimize the risk of not having the needed input of production (Federal Reserve Bank of St. Louis, 1995). A just-in-time system puts increased stress on both the supplier and purchaser in the course of its implementation and places the purchaser at the mercy of its key suppliers, meaning the supplier must never be wrong in terms of quantity or quality (Karlsson & Norr, 1994). Optimally a supplier themselves will be on or working towards a just-in-time system themselves, but this is not always possible (Fallon & Browne, 1988).

Just-in-time is a concept developed by Toyota and introduced during the 1950s and 1960s that has the characteristics of a pull system, meaning required inventory is only produced or used when demand is “pulling” to do so. After the inventory is used up, only what is needed to replace what has been used is manufactured. Because goods are only produced to keep up with demand, there is minimal inventory which can cause a reduction in overhead and an increase in responsiveness. JIT systems are based on the pull concept rather than the push concept, where products are manufactured in advance in anticipation that there will be a consumer demand (Collier 379). Many companies are motivated to implement just-in-time, or JIT, systems because it avoids time, cost, overhead and forecasting that is associated with keeping inventory on hand much like a push system (Kokemuller).