What is the benefit of JIT?

One benefit of JIT (tust in time) is that the business does not have to pay for storage of these goods, by renting a warehouse where they store the goods. This decreases their fixed cost, therefore increasing their profit margins. Also JIT ensures that the good are only ordered once demand is high which prevents the risk of the product becoming obsolete

Just-in-time (JIT) production is a business strategy in which a manufacturer produces goods only as they are ordered, rather than maintaining a large inventory of surplus products. The benefits of JIT include:

Reduction in inventory: Minimizing stock levels reduces storage costs and lowers the risk of overstocking or waste.

Improved quality: JIT emphasizes the production of high-quality items, often with a focus on continuous improvement.

Reduced space requirements: With less inventory on hand, the need for storage space is significantly reduced.

Shorter lead times: Production is streamlined, resulting in faster turnaround times for customer orders.

Lower production costs: By minimizing waste and optimizing resources, JIT helps reduce overall production expenses.

Increased productivity: Focused production processes lead to more efficient use of time and resources.

Increased machine utilization: Machines are used more effectively, as production is directly tied to demand.

Greater flexibility: JIT allows manufacturers to adapt quickly to changes in demand, providing greater responsiveness to customer needs.