What is the primary function of a Just-In-Time Delivery System?

The primary function of a Just-In-Time Delivery System is to order goods just as the organization needs them. This approach aims to streamline operations by reducing the excess inventory that a business might hold. By timing the purchases to coincide closely with production schedules or sales, companies can minimize storage costs, reduce the risk of inventory obsolescence, and improve cash flow. This system helps ensure that materials arrive when they are needed for production, which enhances operational efficiency and responsiveness to demand changes.

The focus on minimizing inventory levels helps organizations avoid the pitfalls associated with overstocking, such as increased holding costs and the potential for waste. This method contrasts with approaches that rely on anticipating demand and stocking inventory in advance, which can lead to higher costs and inefficiencies.