Why Just-in-Time Inventory Reordering is Your Best Bet to Reduce Costs

Currently, the industrial sector is responsible for about 32% of the nation’s total energy consumption. Between compliance fees, utility charges, and labor expenses, manufacturing plants expect high costs when it comes to storing inventory on-site. However, to keep up with surges in demand, manufacturers must keep necessary materials always in hand lest they risk sudden stockouts that lead to delays in production, lost sales, and product shortages. To circumvent these issues, inventory management strategies like just-in-time (JIT) material reordering have become more prominent as a way to alleviate storage expenses, yet while cost-effective, JIT leaves little room for error.

When operating in a JIT inventory management system, facilities strive to keep less inventory on site to avoid stockpiling materials that may not get used. This means that operators must quickly reorder materials as soon as they dip below an established threshold point to avoid shortages. Failure to reorder on time can pause operations since the production line has to wait for incoming materials. When done correctly, JIT enables:

• Minimized storage costs
• Greater visibility on products assembled
• Mitigated depreciation risks
• Maximized storage space for finished goods
• Seamless adaptability to sudden increases in demand

Establishing Effective Tracking for Just-in-Time Reordering

To prevent the risks of inefficient JIT inventory management, a viable system should integrate the following three factors.

1. Real-time data visibility – Preventing out-of-stocks requires fast insight into dwindling inventory. That’s why real-time visibility stemming from technologies such as RFID locationing and digitization have become essential in securing JIT efficiency since they allow workers to target decreasing inventory counts before they fall below the established threshold level. 
2. Unbroken workforce communication – In addition to timely visibility, workers should be able to communicate with each other immediately to notify of any impending shortages or stockouts. Solutions like Zebra’s Workforce Connect transforms current handheld devices into two-way radios for manufacturer and delivery teams, closing the gaps between delivery and receiving docks, so workers know when and where incoming shipments will arrive.
3. Scalable automation – One of the perks of JIT reordering is that it facilitates adaptability in the event of sudden surges in demand, yet this flexibility can only be capitalized if the correct data processing tools are in place. Versatile enterprise devices such as Zebra’s rugged tablets provide adaptable functionality with flexible connectivity options, built-in scanning capabilities, longer battery life, and higher data security parameters to streamline data capture, processing, and sharing on one platform. Therefore, workers can simply add an additional layer of functionality to their versatile devices instead of having to deploy an entire new device to keep up with changes.   

While JIT inventory management has gripped the attention of most manufacturers, it is only one of the many ways supply chains are adapting to meet demands and overcome shortages challenges. To get a better idea of how you can optimize your inventory management system, schedule a workflow assessment and explore the modernized solutions reshaping supply chains today