Just-in-time (JIT) manufacturing is an inventory strategy that receives goods only as needed in the production process to reduce inventory costs. It requires accurate demand forecasting. A key example is a car manufacturer with low inventory relying on precise deliveries from suppliers. Advantages include reduced costs from eliminating storage and buying only what is needed. However, disruptions in the supply chain, such as a supplier breakdown, can shut down production. Toyota successfully uses JIT but nearly faced disaster in 1997 when a fire at its sole brake parts supplier caused a two-day shutdown costing $15 billion.

1. Just In Time (JIT)
By Navin.R.I

2. What is JIT ?
• Just-in-time (JIT) manufacturing, also known as just-in-time
production or the Toyota Production System (TPS), is a
methodology aimed primarily at reducing flow times within
production system as well as response times from suppliers
and to customers. Its origin and development was in Japan,
largely in the 1960s and 1970s and particularly at Toyota

3. • Just-in-time (JIT) is an inventory strategy companies employ
to increase efficiency and decrease waste by receiving goods
only as they are needed in the production process, thereby
reducing inventory costs. This method requires producers to
forecast demand accurately.
• This inventory supply system represents a shift away from the
older just-in-case strategy, in which producers carried large
inventories in case higher demand had to be met.
• A good example would be a car manufacturer that operates
with very low inventory levels, relying on its supply chain to
deliver the parts it needs to build cars. The parts needed to
manufacture the cars do not arrive before or after they are
needed; instead, they arrive just as they are needed.

4. Advantages
• Just-in-time inventory control has several advantages over
traditional models.
• Production runs remain short, which means manufacturers
can move from one type of product to another very easily.
• This method reduces costs by eliminating warehouse storage
needs. Companies also spend less money on raw
materials because they buy just enough to make the products
and no more.

5. Disadvantages
• The disadvantages of just-in-time inventories involve
disruptions in the supply chain.
• If a supplier of raw materials has a breakdown and cannot
deliver the goods on time, one supplier can shut down the
entire production process.
• A sudden order for goods that surpasses expectations may
delay delivery of finished products to clients.

6. Case study
• Toyota uses just-in-time inventory controls as part of its business model. Toyota
sends off orders for parts only when it receives new orders from customers. The
company started this method in the 1970s, and it took more than 15 years to
perfect. Several elements of just-in-time manufacturing need to occur for Toyota
to succeed. The company must have steady production, high-quality workmanship,
no machine breakdowns at the plant, reliable suppliers and quick ways to
assemble machines that put together vehicles.
• Toyota's just-in-time concept almost came to a crashing halt in February 1997. A
fire at a brake parts plant owned by Aisin decimated its capacity to produce a P-
valve for Toyota vehicles. The company was the sole supplier of the part, and the
fact that the plant was shut down for weeks could have devastated Toyota's supply
line. The auto manufacturer ran out of P-valve parts after just one day. Production
lines shut down for just two days until a supplier of Aisin was able to start
manufacturing the necessary valves. Other suppliers for Toyota also had to shut
down because the auto manufacturer didn't need other parts to complete any cars
on the assembly line. The fire cost Toyota nearly $15 billion in revenue and 70,000
cars due to its two-day shutdown, but it could have been much worse.

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