It is well documented that JIT reduces physical inventory level. Reductions in physical inventory will also have a favorable impact on:
Reduced insurance premiums associated with the storage of inventory.Reduced inventory holding costs.Reduced labor cost in store rooms and material handing costs.Reduced clerical and administrative costs.Reduced waste from the manufacturing process.Reduced obsolescence costs.Reduced deprecation of handling and storage equipment.ach of the cost savings will result in a leaner more profitable operation.

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The reduction in physical inventory levels as a result of JIT will have many favorable impacts on a business, including reduced insurance premiums, inventory holding costs, labor costs, material handling costs, clerical and administrative costs, waste from the manufacturing process, obsolescence costs, and depreciation of handling and storage equipment. These cost savings will ultimately result in a leaner and more profitable operation.

It Is Well Documented That JIT Reduces Physical Inventory Level