The benefits and costs of JIT sourcing

Abstract

There is a relative dearth of literature which examines the implications for suppliers which deliver on a just‐in‐time (JIT) basis. Some authors suggest that there are significant benefits for both the buyer and the supplier through participation in JIT procurement, although there are other reports which claim that the suppliers are being forced to increase their stock holding. Reports on a series of semi‐structured interviews conducted with 18 Scottish‐based JIT suppliers. Claims the results indicate that those suppliers which were able to manufacture JIT themselves were, unless subject to substantial schedule instability, able to resist the transfer of inventory, while the non‐JIT manufacturers experienced an increase in inventory. Finds that all the suppliers had experienced an increase in their administrative burden, as a result of JIT delivery.

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