Safety stock requirements are higher in a just-in-time (JIT) inventory system than in a traditional inventory system.

Question

Quizplus · Accepted Answer

Just-in-time (JIT) inventory systems aim to minimize inventory levels, including safety stock, by receiving goods only as they are needed in the production process, whereas traditional inventory systems often maintain higher levels of safety stock to buffer against uncertainties in supply and demand.

Safety Stock Requirements Are Higher in a Just-In-Time (JIT) Inventory