Which approach minimizes inventory by delivering components just before they are needed?

Which approach minimizes inventory by delivering components just before they are needed?

• A. Outsource
• B. Offshore
• C. Intermodal connections
• D. Just-in-time delivery

Answer: (D)

Just-in-time delivery focuses on delivering components exactly as they are needed for production, not earlier. By aligning supplier deliveries with the production schedule, a company reduces raw material and work-in-progress inventory, cutting carrying costs and freeing up capital. This pull-based flow relies on tight coordination: reliable suppliers, short, predictable lead times, small batch sizes, and frequent, timely communications (often signaled by Kanban). When done well, inventory sits where it belongs—on the shop floor only when required to continue the process—minimizing storage space and risk of obsolescence. However, it requires a robust, resilient supply chain and contingency plans, because any delay can halt production. Other approaches change where manufacturing happens, or how goods are transported, but they don’t inherently minimize inventory by timing deliveries; outsourcing shifts production to others, offshore moves facilities to distant locations, and intermodal connections focus on using multiple transport modes for efficiency.

Just-in-time delivery focuses on delivering components exactly as they are needed for production, not earlier. By aligning supplier deliveries with the production schedule, a company reduces raw material and work-in-progress inventory, cutting carrying costs and freeing up capital. This pull-based flow relies on tight coordination: reliable suppliers, short, predictable lead times, small batch sizes, and frequent, timely communications (often signaled by Kanban). When done well, inventory sits where it belongs—on the shop floor only when required to continue the process—minimizing storage space and risk of obsolescence. However, it requires a robust, resilient supply chain and contingency plans, because any delay can halt production. Other approaches change where manufacturing happens, or how goods are transported, but they don’t inherently minimize inventory by timing deliveries; outsourcing shifts production to others, offshore moves facilities to distant locations, and intermodal connections focus on using multiple transport modes for efficiency.