2.3.5

Just In Time & Just In Case

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Managing Stock - Just in Time

Just in time (JIT) is a method for managing stock that aims to keep stock levels very low at all times.

Benefits of JIT

Benefits of JIT

  • JIT can reduce costs because a business does not have to pay for storage space for the stock and the business is likely to have less unsold stock.
  • Storage also adds other costs, for example damage to stock, stock insurance and security to protect the stock.
Disadvantages of JIT

Disadvantages of JIT

  • JIT usually needs more frequent deliveries. More deliveries usually means higher transport and logistic costs. There may also be environmental costs and an impact on the local community. – Because a firm using JIT is buying in lower quantities, rather than in bulk, they will get smaller or no discounts on the materials that they are buying.
  • With JIT, there is a higher chance that the business will not be able to meet demand if there is an unexpected spike in demand. This is because they do not keep stock in reserve (buffer stock).

Managing Stock - Just in Case (JIC)

JIC is the opposite of JIT. With JIC system, a business will keep a ‘buffer stock’ of materials for production and finished goods. If there are problems with the supply chain or there is an unexpected spike in demand, the company can just use the buffer stock to make goods and deliver to customers.

Benefits of JIC

Benefits of JIC

  • If there is an unexpected spike in demand, then a business’ buffer stock of finished products will be able to cope with it.
  • If there is any problem with the supplier then the production process won’t have to stop. They can use the buffer stock to keep it going until the problem is fixed.
Disadvantages of JIC

Disadvantages of JIC

  • The main issue with JIC stock control is that businesses may end up holding lots of stuff in huge warehouses.
  • Warehouses and the logistics to organise stock are both costly. This can increase the costs of a firm and therefore have a potentially negative effect on profits.
Jump to other topics
1

Investigating Small Business

1.1

Enterprise & Entrepreneurship

1.1.1The Dynamic Nature of Businesses1.1.2Risk & Reward1.1.3The Role of Business Enterprise1.1.4The Role of Business Enterprise 21.1.5The Role of the Entrepreneur1.1.6End of Topic Test - Dynamic Nature of Business1.1.7Grade 9 - Dynamic Nature of Business
1.2

Spotting a Business Opportunity

1.2.1Customer Needs1.2.2Market Research1.2.3Market Segmentation1.2.4The Competitive Environment1.2.5Primary & Secondary Market Research1.2.6End of Topic Test - Business Opportunities1.2.7Application Questions - Business Opportunities1.2.8Exam-Style Questions - Market Segmentation1.2.9Diagnostic Misconceptions - Competition
1.3

Putting a Business Idea into Practice

1.3.1Business Aims1.3.2Business Objectives1.3.3Business Revenues & Costs1.3.4Costs - Calculations1.3.5Revenue - Calculations1.3.6Business Profits & Break-Even Analysis1.3.7Profits & Losses - Calculations1.3.8Interest - Calculations1.3.9Cash & Cash Flow1.3.10Cash & Cash Flow 21.3.11Cash Flow - Calculations1.3.12Sources of Business Finance1.3.13End of Topic Test - Business in Practice1.3.14Grade 9 - Business in Practice1.3.15Exam-Style Questions - Business in Practice1.3.16Diagnostic Misconceptions - Profit1.3.17Diagnostic Misconceptions - Company vs Business1.3.18Diagnostic Misconceptions - Economies of Scale1.3.19Diagnostic Misconceptions - Cash Flow1.3.20Diagnostic Misconceptions - Break-even1.3.21Diagnostic Misconceptions - Fixed Costs
1.4

Making the Business Effective

1.4.1The Options for Start-Up & Small Businesses1.4.2Limited Liability1.4.3Franchising & Not-For-Profits1.4.4Business Location1.4.5The Marketing Mix1.4.6Business Plans1.4.7End of Topic Test - Effective Business1.4.8Application Questions - Effective Business1.4.9Exam-Style Questions - Business Plans
1.5

Business Stakeholders

1.5.1Business Stakeholders1.5.2Technology & Business1.5.3Legislation & Business1.5.4Legislation & Business 21.5.5The Economy & Business1.5.6External Influences1.5.7End of Topic Test - Business Stakeholders1.5.8Grade 9 - Business Stakeholders1.5.9Diagnostic Misconceptions - Recessions
2

Building a Business

2.1

Growing the Business

2.1.1Business Growth2.1.2Finance2.1.3Changes in Business Aims & Globalisation2.1.4Ethics & Business2.1.5The Environment & Business2.1.6End of Topic Test - Growing a Business2.1.7Application Questions - Growing a Business2.1.8Exam-Style Questions - Business Growth
2.2

Making Marketing Decisions

2.2.1Product2.2.2Product Life Cycle2.2.3Price2.2.4Pricing Methods2.2.5End of Topic Test - Product & Price2.2.6Grade 9 - Product & Price2.2.7Promotion & Advertising2.2.8PR & Sales Promotions2.2.9Sponsorship & Product Placement2.2.10Promotional Mix2.2.11End of Topic Test - Promotion2.2.12Application Questions - Promotion2.2.13Exam-Style Questions - Promotional Mix2.2.14Place & Wholesalers2.2.15Direct to Consumer2.2.16E-commerce & M-commerce2.2.17Diagnostic Misconceptions - Decreasing Price2.2.18Diagnostic Misconceptions - Advertise vs Promote2.2.19Diagnostic Misconceptions - Social Media
2.3

Making Operational Decisions

2.3.1Job Production2.3.2Batch & Flow Production2.3.3Working with Suppliers2.3.4Effective Supply Chains2.3.5Just In Time & Just In Case2.3.6Managing Quality2.3.7Total Quality Management2.3.8The Sales Process2.3.9End of Topic Test - Operational Decisions2.3.10Grade 9 - Operational Decisions2.3.11Exam-Style Questions - Managing Stock2.3.12Diagnostic Misconceptions - JIT vs JIC
2.4

Making Financial Decisions

2.4.1Gross Profit & Net Profit - Definitions2.4.2Gross Profit - Calculations2.4.3Net Profit - Calculations2.4.4Rate of Return2.4.5Rate of Return - Calculations2.4.6Research & Financial Data2.4.7Marketing Data2.4.8Percentage Change - Calculations
2.5

Making Human Resource Decisions

2.5.1Organisational Structures2.5.2Organisational Structures 22.5.3Recruitment2.5.4Effective Recruitment2.5.5Training a Workforce2.5.6Motivating a Workforce2.5.7End of Topic Tests - Human Resources2.5.8Application Questions - Human Resources2.5.9Exam-Style Questions - Human Resources2.5.10Diagnostic Misconceptions - Owners vs Shareholders2.5.11Diagnostic Misconceptions - Internal Recruitment2.5.12Diagnostic Misconceptions - Employee Motivation

Practice questions on Just In Time & Just In Case

Can you answer these? Test yourself with free interactive practice on Seneca — used by over 10 million students.

  1. 1
    For a lemonade business using JIT, what may happen in a heatwave?Multiple choice
  2. 2
    Features of JIT:True / false
  3. 3
    Which of the following is an advantage of JIT?Multiple choice
  4. 4
    Which type of stock management will help a business cope if there is a sudden problem with raw material supplies?Multiple choice
  5. 5
    Just in case vs Just in time:True / false
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Effective Supply Chains

Managing Quality