Just-in-Time Inventory JIT

Just-in-time inventory means ordering small amounts often, so the goods arrive shortly before you need them. Instead of filling a storeroom once a month, you buy a week at a time, which keeps the money moving. The idea started in Japanese car factories, and it now runs everything from a coffee shop to a warehouse.

The appeal is money. Stock on a shelf is cash you have already spent and cannot use until someone buys it, so buying less at a time keeps it in the bank for the rent or the wages. You also need a smaller storeroom, and less goes out of date or out of fashion while it waits for a buyer.

Two numbers make it work. The first is the supplier lead time, the days between placing an order and the box arriving. The second is the reorder point, the stock level that tells you to order again. So if you sell four a day and the supplier needs five days, you order when you reach twenty, and a few units on top cover a busy week.

Ask the supplier for the real lead time, not the promised one, because five days on the order form can become nine in December. The honest way to find it is to write down what happened on the last six deliveries and use that figure instead. Linkysoft measures it before building the ordering part of a web application, since the promised time and the real one are rarely the same. That hour with the delivery notes is the most useful one a shop owner can spend.

Now the weak point, because just-in-time keeps no cushion and one late lorry empties the shelf. A driver stuck at a border on Monday becomes a lost sale on Tuesday and an angry regular on Wednesday. That means ordering little and often moves the risk onto you when the supplier is far away or the road is unreliable. Keep a small safety stock on the items you cannot afford to run out of, and accept that it costs something.

None of this works by memory, which is why Storek watches how fast each product sells and raises the purchase order itself the moment stock passes the reorder point. Nobody has to remember, and nobody is blamed on the day they forget. Linkysoft usually starts a shop project by reading a year of sales history, because a good reorder point comes out of that history rather than an opinion.