What does the "Just-In-Time" (JIT) inventory strategy aim to achieve?

The "Just-In-Time" (JIT) inventory strategy primarily aims to reduce inventory costs by ordering supplies as needed, which allows organizations to minimize the amount of inventory they hold at any given time. This approach aligns closely with lean management principles, where the focus is on efficiency and reducing waste. By keeping inventory levels low and only ordering products as they are required for production or service delivery, organizations can decrease storage costs, reduce the likelihood of obsolescence, and improve cash flow.

This strategy also encourages suppliers to respond quickly to orders, fostering better supply chain relationships and flexibility. Overall, the JIT method is designed to create a more responsive and efficient inventory management system that meets customer demand without overstocking, which can tie up capital and resources.