Which term describes ordering goods just before they are required, avoiding storage costs but requiring a short lead time?

Which term describes ordering goods just before they are required, avoiding storage costs but requiring a short lead time?

• A. Lead time
• B. Mission statement
• C. Just-In-Time (JIT)
• D. Planning

Answer: (C)

Just-In-Time (JIT) describes an inventory approach where materials are ordered and delivered only as they are needed in the production process. This minimizes storage and carrying costs because you keep little stock on hand. For JIT to work, lead times must be short and reliable so orders can be scheduled to arrive exactly when required. That combination of minimal inventory and precise timing distinguishes JIT from simply looking at the lead time itself, which is just the duration between ordering and receiving. A mission statement is about purpose and direction, planning is a broader process, and neither captures the idea of ordering to match usage with minimal stock.

Just-In-Time (JIT) describes an inventory approach where materials are ordered and delivered only as they are needed in the production process. This minimizes storage and carrying costs because you keep little stock on hand. For JIT to work, lead times must be short and reliable so orders can be scheduled to arrive exactly when required. That combination of minimal inventory and precise timing distinguishes JIT from simply looking at the lead time itself, which is just the duration between ordering and receiving. A mission statement is about purpose and direction, planning is a broader process, and neither captures the idea of ordering to match usage with minimal stock.