Just in time stock control management

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  • Created by: LivStorm
  • Created on: 10-06-21 18:49
Just in time (JIT) definition
a stock control system that does away with the need to hold large quantities of stock or raw materials. Stocks arrive as they are needed. Aim to keep stock levels to a minimum to become more efficient.
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What JIT relies on
frequent deliveries of small quantities of supplies as and when they are needed.
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How JIT relates to the relationship with suppliers and producers
Involves a close relationship to ensure supplies actually arrive in time and that quality of component is totally reliable.
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How JIT saves on costs
Removes the need to hold large reserve stocks which are expensive to purchase and store.
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JIT advantages
Holding less stock improves liquidity and saves on costs.
Space might have been needed for stock is now free for production.
Easier to be flexible and respond to special orders or changes to demand.
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JIT disadvantages
Only buy in small amounts of supplies at a time which could remove savings from economies of scale.
Business depends on supplier, late deliveries or poor quality of a component disrupts production and is costly. A good relationship is very important.
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Stock control chart main aspects
Stock level
Maximum stock level
Reorder quantity
Reorder level
Minimum stock level
Buffer stock
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Lean supply definition
the idea of eliminating waste in the supply chain by a process of collaboration and cooperation.
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Why a JIT stock control chart looks different
buffer stocks are eliminated in JIT system
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Lean production definition
any system of production that tries to minimise waste during production process. This helps to cut costs. It combines components of JIT.
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Lean production related to dynamic markets
Lean and flexible production allows businesses to adapt to dynamic markets.
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Lean production advantages
Reduces waste and related costs
Reduces costs of storage and handling
Customers more satisfied with quality
Greater flexibility
Shorter lead times
More motivated staff, less staff turnover
Lower costs from fewer rejects
Improves quality
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Lean production disadvantages
Does not suit all production processes
Managers and staff may not be flexible enough
Workers may dislike greater responsibility
Failure by one small supplier can halt entire production process
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Other cards in this set

Card 2

Front

What JIT relies on

Back

frequent deliveries of small quantities of supplies as and when they are needed.

Card 3

Front

How JIT relates to the relationship with suppliers and producers

Back

Preview of the front of card 3

Card 4

Front

How JIT saves on costs

Back

Preview of the front of card 4

Card 5

Front

JIT advantages

Back

Preview of the front of card 5
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