Which of the following is a disadvantage of a just-in-time management system?
A)It results in a decrease in production space.
B)It increases the inventory cost.
C)The risk of the inventory becoming obsolete is very high.
D)The users of this system sometimes lose sales because of little or no inventory buffers.

Question

Quizplus · Accepted Answer

The just-in-time management system is designed to keep inventory levels low and only order what is needed to fulfill customer orders. This means that there is little or no inventory buffer available, which can result in lost sales if demand suddenly increases and the company is unable to meet it. This is a disadvantage of the system. Option A is incorrect because the just-in-time management system often involves reducing the amount of production space needed. Option B is incorrect because the just-in-time management system is designed to reduce inventory costs. Option C is incorrect because the risk of inventory becoming obsolete is reduced with the just-in-time management system.

Which of the Following Is a Disadvantage of a Just-In-Time