What are the advantages of getting things when they need?
- Money available to use for other pressing issues or investments
- Less interest or bank charges to pay
- Not necessary to have large storage
- Less damages and quality problems
- Ability to avoid duplicate work
Advantages of JIT
Let’s look at each advantage using an example. A great example to discuss the importance of JIT in Apparel Industry is fabric. In most of the garment costings, 60% to 70% of the cost goes for the materials. Apart from the cost of the materials, fabric is responsible for various other direct and in-direct costs. Those are,
- Cost of the fabric
- Transportation
- Inventory (Storage)
- Inspection (Labour)
- Bank charges (L/C or TT charges)
- Interest payment
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| Fabric checking |
Now let’s say we have an order of 100,00 pieces of shirts and fabric consumption is 1 yard per garment. We need 100,000 yards. Buyer requesting 4 staggered deliveries of 25,000 pieces per each month. Our expected line output per day is 500 pieces and factory manager planning to use 2 lines.
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| Fabric store |
Essentially factory planner fit the monthly required qty in to 2 lines and it fits the time and action calendar.
Production merchandiser place the order with a mill and discuss the delivery plan. Now this is where factory has to be smart. Fabric mill would want to send the total 100,000 yds soon as possible and collect the money as 100,000 yds is not that of a big order for most of the mills. Also they do not have any incentive to store the goods. Sooner they get the goods out of the warehouse, sooner they could collect the money.
However, production merchandiser of the factory should not get intimidated by the mill.
After discussing with the store manager and the factory manager, merchandiser have to determine how many days prior to production they need the goods in-house. Generally, 5 to 10 days is the maximum. L/C should be opened for the total amount to avoid duplication of charges but only release funds for each delivery so the factory would not incur unnecessary interests.
After discussing with the store manager and the factory manager, merchandiser have to determine how many days prior to production they need the goods in-house. Generally, 5 to 10 days is the maximum. L/C should be opened for the total amount to avoid duplication of charges but only release funds for each delivery so the factory would not incur unnecessary interests.
Factory fabric manager have to communicate with relevant quality manager/ checker of the mill and get the inspection reports prior to shipping of each consignment to be aware all the issues mill found during the inspection. If the damage percentage is high factory could get the mill to do the necessary re-inspections and ensure good quality fabric are shipped avoiding unnecessary delays and expenses.
Warehouse manager in the factory do not have to allocate extra manpower to receive the fabric and stock them as only required potion is coming to the warehouse.
In my opinion no need to do a fabric inspection once fabric arrives from the mill (Typically most factories check 10% of the received quantity using 4-point method). In my opinion this is a waste. This day and age there are no time to check and checking actually do not help the production anyway. If the damage percentage is high, mill will send replacement fabric. Its advisable to relax the fabric(If knit) and cut straightway. Since fabric manager already done the due diligence and gone through the inspection reports, chances are finding damages are slim.
In my opinion no need to do a fabric inspection once fabric arrives from the mill (Typically most factories check 10% of the received quantity using 4-point method). In my opinion this is a waste. This day and age there are no time to check and checking actually do not help the production anyway. If the damage percentage is high, mill will send replacement fabric. Its advisable to relax the fabric(If knit) and cut straightway. Since fabric manager already done the due diligence and gone through the inspection reports, chances are finding damages are slim.
I do understand this might not be the case involving certain mills as they may not necessarily show the actual picture of the finished fabric. but building a relationship with the mills and encouraging to discuss the real situation of the production is important to both mill and the factory.
How JIT helps to reduce damages
Another major advantage of just in time is it actually reduces the amount of damages. This happens in several stages.
When the fabric comes in several deliveries, initial deliveries already been used so based on the feedback mill could do the adjustments and ensure good fabric are delivered
Since factory do not have to stock large quantities of fabric in the warehouse, damages occurred due to pest, wrong storage practices are minimized.
As fabric are arriving when really needed for the production, factory managers and executive do not able to bypass the system and produce garments which are not needed for the current deliveries. While itself this is stopping waste, it also ensures garments with damages are not produced and stored for future delivery.
About the Author: Charm Rammandala is the founder & CEO of IStrategy USA. He counts over two decades in fashion supply chain in diverse roles as Lean Manager and Model himself. He is an expert in rolling out programs in Lean apparel manufacturing and Sustainable labour costing. His former positions included being the first Lean Technologist at George Sourcing Services UK Ltd.
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