Question

Mr. D is the manager of a local Walgreens. His biggest concern is to make sure that hisstore is always making the most profit possible. He cuts costs by focusing on certainlogistical decisions. Every other day Walgreens receives shipments from Pepsi, Evian,Hershey, and numerous other manufacturers. Walgreens insists on small shipmentsevery two days, which helps to keep their inventory costs low. What system is Mr. D usingat Walgreens to reduce his costs?
A. electronic data interchange
B. materials handling
C. backward vertical integration
D. just in time inventory
E. vendor managed inventory

Answer 1

D. Just in time (JIT) inventory.

JIT inventory systems make sure that the needed products and materials and received right as they are needed to reduce the holding costs associated with receiving, processing, and storing large amounts of inventory.

Answer 2

What system is Mr. D using at Walgreens to reduce his costs?

D. just in time inventory

Just in time inventory, JIT, is used to increase efficiency and decrease waste. Businesses are able to accomplish this by receiving inventory goods only when they are needed. When a business lowers the amount of items they constantly have coming in they are reducing inventory costs, especially storage costs for holding inventory that is not currently being used.