Which practice demonstrates coordinating deliveries to minimize on-hand inventory, as shown in Just-In-Time delivery?

Which practice demonstrates coordinating deliveries to minimize on-hand inventory, as shown in Just-In-Time delivery?

• A. FIFO
• B. ABC classification
• C. Just-In-Time delivery
• D. LIFO

Answer: (C)

Coordinating deliveries to minimize on-hand inventory is the essence of Just-In-Time delivery. The idea is that materials arrive exactly when they are needed in the production process, so you keep very little inventory on hand. This requires tight coordination with suppliers, reliable scheduling, and small, frequent shipments. The payoff is lower carrying costs, reduced waste, and a smoother cash flow, though it does rely on dependable suppliers and logistics to avoid production delays. The other concepts play different roles: FIFO and LIFO are about how stock is used or valued over time, not about delivery timing; ABC classification prioritizes items by importance or usage but doesn’t address timing of deliveries.

Coordinating deliveries to minimize on-hand inventory is the essence of Just-In-Time delivery. The idea is that materials arrive exactly when they are needed in the production process, so you keep very little inventory on hand. This requires tight coordination with suppliers, reliable scheduling, and small, frequent shipments. The payoff is lower carrying costs, reduced waste, and a smoother cash flow, though it does rely on dependable suppliers and logistics to avoid production delays. The other concepts play different roles: FIFO and LIFO are about how stock is used or valued over time, not about delivery timing; ABC classification prioritizes items by importance or usage but doesn’t address timing of deliveries.