# Just-in-Time Inventory ## Definition A capital management practice in which goods are received from suppliers only as they are needed for production or fulfilment, minimising the stock held at any moment. JIT eliminates inventory as a buffer by replacing it with reliable process coordination — synchronised production schedules, short lead times, and high-frequency deliveries. The capital released from inventory reduction is the primary financial justification. ## Source Capital and Inventory in Supply Chain Management, §Just-in-Time Inventory ## Supply Chain Domain Capital Management ## VSM Assignment S3 — JIT is a management-level decision about how to deploy circulating capital. It sets the policy for inventory levels (near-zero) and enforces that policy through supplier relationship design and production scheduling. ## WoN Concept Circulating Capital — Smith distinguishes circulating capital (consumed and replaced each productive cycle) from fixed capital (durable). JIT is an explicit strategy to minimise the circulating capital locked in inventory at any moment, accelerating the velocity of the capital cycle. The faster capital circulates, the greater the productive output per unit of capital stock — precisely Smith's argument for keeping circulating capital in motion rather than idle.