Just-in-time (JIT) stock control This stock control method aims to avoid holding stocks by requiring supplies to arrive

just as they are needed in production and completed products are produced to order. JIT requires that no buffer stocks are held, components arrive just as they are needed on the production line and finished goods are delivered to customers as soon as theyre finished. For it to be successful: Relationships with suppliers have to be excellent so that they are prepared to supply fresh supplies at short notice (short lead time). Supplier must be reliable. Each worker must be able to switch to making different items at very short notice so that no excess supplies of any of product are made Equipment and machinery must be flexible to adapt to demand As there are no spare parts in this method, the product must be made right at the first attempt, quality is key Advantages Opportunity cost of holding stock is reduced, and investing in storage space is reduced Space released from stock holding can be used for something else Less chances of products become obsolescent or outdated, less wastage Quicker response rates to consumer demand Multi-skilled staff are required for JIT, this will be motivating for them Disadvantages Failure to receive components on time is a big problem More frequent deliveries will be needed, this will add to expenses Order-administration costs will rise No economies of scale, since few are ordered in each time If supplying firms = unreliable, business will have big problems