Just-in-Time Inventory
Just-in-time (JIT) inventory is a management strategy that aligns raw material orders and production schedules with actual demand, receiving goods only as they are needed for sale or production rather than holding large safety stocks.
Just-in-time inventory directly impacts cash flow and profitability. Excess inventory ties up capital, requires warehousing, and risks becoming obsolete or requiring markdowns. JIT minimizes these costs, but it demands accurate forecasting and reliable supply chains to avoid the equally costly problem of stockouts.