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JIT

This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.

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August 3, 2021 at 9:57 am #630238
HamzaYusuf
Member
- Topics: 38
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Is it true that in the JIT inventory system re-ordering costs will increase but holding costs will decrease?
Is it true that JIT is where we order the raw material from suppliers only when we need it for production (or there is any demand from customers) & turn it into finished goods only when we have a customer order or customer demand of such inventory?
August 3, 2021 at 2:53 pm #630273
John Moffat
Keymaster
- Topics: 57
- Replies: 51538
First sentence – it is true that the annual reorder cost will be higher and the annual holding cost will be lower.
Second sentence is true also.
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