What is the purpose of the just-in-time (JIT) inventory system?

The purpose of the just-in-time (JIT) inventory system is to minimize inventory levels and reduce waste. JIT focuses on receiving goods only as they are needed in the production process, which helps to lower inventory carrying costs and reduces the space required for storage. By aligning production schedules closely with demand, organizations can avoid the costs associated with excess inventory, such as obsolescence, spoilage, and the capital tied up in unsold goods. This approach not only streamlines operations but also encourages a more efficient production flow, ultimately leading to improved overall efficiency and cost-effectiveness. The reduction in waste is also aligned with lean manufacturing principles, which emphasizes the importance of continuous improvement and minimizing non-value-added activities in the supply chain.