Many businesses have adapted the Japanese just-in-time system for inventory control as a way to minimize overhead and only handle products when they’re on demand by customers. This clearly leaves time and space for other aspects of the business such as repurposing physical space and cross-training employees. But how does it affect the manufacturing side of things? Here are a few pros and cons of the just-in-time, or JIT system when it’s applied to manufacturing.
Pros of Just-In-Time Manufacturing
- Reduced inventory costs due to less stocked materials
- Leads to reduced need for warehouse expansion
- Less waste from expired, outdated materials which would’ve normally sat on a shelf
- Less energy costs if machines are left off
- More time to cross-train employees in other facets of the business
- Or employee costs from inventory management can be reallocated
- On-hand materials tend to be more versatile so they can be applied to a range of processes
Cons of Just-In-Time Manufacturing
- Unforeseen influxes in production can back up order flows
- This can lead to order rushes, which reduces quality control under tight deadlines
- Irregular use of machinery means less time for preventative, scheduled maintenance
- Infrequent delivery of materials means more complexity in coordinating with others on the supply chain
- Less inventory on hand means more investment is required in predictive technology to be ready for order influxes
Is JIT Right for Your Business?
The JIT system certainly has its place in different industry settings, but its upside and downside should be carefully considered before implementing the system across a company’s full production processes. A business with predictable, seasonal swings in production might be able to implement JIT, while a business with more sporadic production varying in size and complexity should consider a system better designed to absorb those drastic changes. What are some ways you’ve utilized JIT in your plant, be it manufacturing or inventory stocking? Share with us in the comments below.
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