Just in time: why we keep running out of everything | It's Complicated

The global supply chain seems to be in a perpetual state of crisis. Whether its groceries, petrol or micro-chips for electric vehicles, everything just keeps running out. But why does it keep happening?

The crux of the matter lies in the way our global supply chain works, and how companies have come to rely on a unique system of efficiency, dubbed 'just in time', which developed in Japan in the late 1960s and early 70s. Josh Toussaint-Strauss explores how the prevalence of just in time supply systems are contributing to a global supply chain crisis

#supplychain #itscomplicated #economics

[gaborkorthy]

I was a manufacturing manager in the early 80's when "just in time" was the darling of all the top business schools. It was obvious to me than that all " just in time" manufacturing did was force the suppliers to hold the large manufactures inventory. It was never about efficiency of manufacturing but more about saving the cost of that inventory.

[matthewbaynham]

Here in Germany we are not running out of anything. Whenever I go to the supermarket there isn't a single empty shelf.

Perhaps the problems with "just in time" don't effect countries that haven't brexited.

[shinygoldcar]

“Efficiency” is not the only benefit to manufacturers like Toyota, quality is also improved. If a component has been made incorrectly, and someone on the line notices, they can inform the person making the component and the issue is rectified almost immediately. In a “just in case” situation, that component could have been made months ago, meaning you have potentially months worth of defective components. Sure, if you are a retailer selling toilet paper, then Just in Time is really only for the cost benefit, but cost is not the only benefit in general.

[jim]

I think that retailers like running out of some items because it makes consumers want to "stock up" which means that consumers will carry at least part of the cost of storing excess inventory.

[margeert]

For the UK, Brexit is one of the main reasons for disruption.. you’ll need a lot of ‘just in case’ inventory… think alone of 10 miles of HGV lorries, standing for 24 hours. That is a lot of money frozen.

[thhanh]

Truth is without Brexit you probably would be having chicken AND toilet rolls, wouldn't that be wonderful? Us in the EU are still struggling to get micro-chips and construction products (such as timber) in time but we are appalled to see what the UK has been going through. In other words it's businesses that suffer more from the pandemic in the EU, we haven't had any shortages in grocery stores. High five brexiteers!

[MrDavrush]

Brexit! Brexit. What is it about Brexit you neither understand? Or acknowledge. The greatest self defeating act by any country. In our lifetime and your ignoring it!

[arnie]

It wasn't a toilet paper shortage it was a Braincell shortage.

[nicolomastronardi]

The supply chain problem isn’t global as the author suggests but British (mainly). The EU block doesn’t have problems related to the supply chain, as much as in the UK.. Brexit?!

[sharonhill]

I grew up in the country side in the 90’s you’d always have a back up. I still do that.

[Ralph-nyey]

So the bottom line answer, as it is to every "why" question in business, is money and profit. Save a buck here, there, worry about problems later.

[dont_listen_to_Albo]

Toyota’s JIT system works because its suppliers’ factories are nearby, so could make multiple deliveries a day if required. JIT doesn’t work if lead times are three months.

[irminschembri]

Strange as little Malta hasn't run out of anything ! Surprised Pikachu face !
Could it be that there was something something in 2016 in the UK

[markhoulder]

Lots of simplistic, or even simply false, information in this video. Toyota tends to be more resilient to supply chain shortages than many competitors because it can react faster to changes in demand, and has much better business intelligence for its supply chain.

[primalconvoy]

Ironically, Japan was one of the last (developed) countries to implement "just in time" practices in its shops and stores, etc. It wasn't until (7-11?), which was then still an American company (now, it's owned by the Japanese side, if I recall) introduced "POS" (point of sale), which basically is using barcode scanners to check stock and streamline inventory to a "just in time model", that Japanese shops came into line with other countries.

[Jason-unps]

This sounds like a huge business opportunity. Get a large enough warehouse in a very impoverished city where you could store excess “just incase” inventory for multiple companies.
Since you’re not selling products yourself, you don’t need to worry about being in an area with customers. You can be in a place where rent/purchasing a warehouse is relatively cheap, and you’d also be bringing jobs to that city so hopefully you could work out some kind of deal with the city where you’re eligible for tax breaks/cheaper power..etc

[prx]

A bit of a simplistic explanation..
Jit is about reducing batch sizes to an ideal of 1..
The emphasis is about improving processes and eliminating setup costs with flexible manufacturing, work centers and staff training.

The nhs would greatly benefit from this.. It still operates as a 1970's manufacturer.. Think of patients as raw material and you get the idea.. Lots of big waiting rooms across hospitals and all offering just one service...

Why am I writing this.. No one cares 🤣

[MrTomtomtest]

Haven't felt or seen a lack of anything personaly, from the EU, but yeah that's the problem with globalized supply chains in a more & more unstable world.

[highstax_xylophones]

Needs to be "just the needs"

[patchthesinclair]

Thank you, I found that very informative!