Inventory management is crucial for business efficiency, involving strategies like Just-in-Time (JIT) and Just-in-Case (JIC). JIT minimizes waste by aligning inventory with production needs, while JIC maintains higher stock levels to mitigate supply chain risks. Both approaches have their pros and cons, influencing a company's operational decisions based on risk tolerance and market demands.
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Inventory management involves ordering, storing, and utilizing a company's inventory to meet customer demand and minimize costs
Inventory management plays a pivotal role in supply chain management by ensuring the right quantity of inventory is available at the right time
Effective inventory management can lead to cost savings, improved operations, and increased profitability
JIT is an inventory strategy that aims to increase efficiency and decrease waste by receiving goods only as they are needed in the production process
JIT can lead to cost savings, improved product quality, and a more streamlined production process
JIT can be vulnerable to supply chain disruptions, require reliable suppliers, and make it difficult to respond to sudden increases in demand
JIC is an inventory approach that involves maintaining higher levels of inventory to guard against potential supply chain disruptions and demand fluctuations
JIC provides a safety net for businesses to continue operations without interruption in the face of unforeseen events
JIC can result in higher inventory carrying costs and tie up capital that could be used more productively elsewhere in the business
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______ management is crucial for ordering, storing, and using a company's ______ and finished products.
Inventory
inventory
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Key requirements for JIT implementation
Precise forecasting, responsive supply chain coordination, synchronization of material arrival with production schedules.
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Cost-saving aspect of JIT
Minimizes inventory holding costs by reducing the amount of inventory kept in stock.
