Definition:
Just-in-Time (JIT) inventory management is the process of ordering and receiving inventory for production and customer sales only as it is needed and not before. This means that the company does not hold safety stock and operates with low inventory levels. This strategy helps companies lower their inventory carrying costs.
Just-in-time inventory management is a cost-cutting inventory management strategy though it can lead to stockouts. The goal of JIT is to improve return on investment by reducing non-essential costs.
Examples:
Just-in-time inventory management is used by Toyota Manufacturing as its inventory management system.
