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What is JIT (just-in-time)? A guide

Just-in-time (JIT) is a production strategy that aims to deliver materials and goods exactly when they are needed to minimize inventory costs and maximize efficiency. Originally developed in Japan, particularly by Toyota, JIT has become a globally recognized principle in production management.

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The basic principles of JIT

1. Demand-oriented production: Production only takes place when needed, which prevents overproduction.
2. Minimize inventory: Materials and components are delivered exactly when needed, reducing inventory costs.
3. Continuous improvement: Processes are constantly analysed and optimised to avoid waste.
4. Close collaboration with suppliers: A reliable and flexible supply chain is essential for the smooth implementation of JIT.
5. Mitigation of errors: Through quality controls and optimized processes, errors should be identified and avoided at an early stage.

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JIT in sales

JIT is not only relevant in production, but also of great importance in sales. Through a needs-based supply chain, companies can react more quickly to customer requests and reduce costs at the same time.

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Benefits of JIT in Sales

• Optimized warehousing: Products are only delivered when there is actual demand, minimizing inventory costs.
• Faster order processing: Orders can be processed more efficiently through lean inventory management and optimized logistics.
• Flexibility: Companies can react better to market changes and take individual customer requirements into account.
• Lower risk of excess inventory: Since products are only ordered and delivered when needed, the risk of slow-keepers or outdated goods decreases.

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JIT challenges in sales

• High dependence on supply chains: Supplier delays can lead to bottlenecks and dissatisfied customers.
• Precise demand planning required: An accurate forecast of demand is essential to avoid delivery problems.
• Vulnerability to market volatility: Sudden fluctuations in demand can be difficult to manage if there are no inventory reserves.

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Conclusion

JIT is an effective strategy for increasing efficiency and reducing costs in production and sales. Companies that successfully implement JIT benefit from lower inventory costs, faster response times, and an optimized value chain. However, it requires precise planning, reliable suppliers and continuous improvement of processes to be successful.

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