BELL WORK: READ THIS….. Just in Time is a stock control method that companies can use. With just in time, a business holds no stock and instead relies.

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Presentation transcript:

BELL WORK: READ THIS….. Just in Time is a stock control method that companies can use. With just in time, a business holds no stock and instead relies upon deliveries of raw materials and components to arrive exactly when they are needed. Instead of occasional large deliveries to a warehouse, components arrive just when they are needed and are taken straight to the factory floor. The benefits of reduced warehouse costs must be balanced against the cost of more frequent deliveries and lost purchasing economies of scale from bulk buying discounts. Reduces spending and improves competitiveness. Just in Time

Stock control Engineering companies need to buy raw materials and components in order to produce their products. The more they buy (bulk buying), the less it costs, the more profit the company makes.  The more they have the more warehouse space they need, the more rent they have to pay. Just in Time

Stock control With JIT a company buys exactly what they need, when they need it. The warehouses have minimal stock levels, so less rent is paid.  The cost of buying is higher than it would be if the company purchased in bulk. Just in Time

The company spends less each month on raw materials and components, making it easy to balance the accounts and more money available for machinery maintenance etc. Just in Time - Money Just in Time

Just in Time - Disadvantages  If a delivery is delayed, then the production is delayed, costing the company money in wages, machinery down time and upsetting customers. Just in Time

Just in Time - Advantages Stock levels are very tightly controlled meaning there is virtually no waste and over ordering is uncommon. If raw materials or components are faulty fewer problems are encountered as a result. Just in Time

Write down the advantages and disadvantages of JIT (Just in Time). Advantages Name Disadvantages Is JIT a good method of lean manufacture?