Just-in-time procurement is also called JIT (just-in-time) procurement. The purchaser sends the order to the supplier through the computer network, and the supplier delivers the goods to the designated place according to the time, quantity and variety required by the purchaser. This ordering method requires a small number of delivery batches at a time, requires suppliers to supply goods frequently, and the purchaser does not have to inspect the goods every time. Just-in-time procurement is an advanced procurement mode, which is of great significance to the implementation of supply chain management ideas.

Background of JIT procurement

Just-in-time procurement evolved from just-in-time production, which is a continuous improvement to reduce inventory and unnecessary waste. Just-in-time production first appeared in Japan. In order to reduce inventory and cost, Japan adopts JIT production mode based on order flow to realize several "zero" management in the production process: zero defects, zero inventory, zero delivery date, zero zero failure, zero paper documents, zero waste, zero accidents and zero waste of human resources. Just-in-time production requires just-in-time supply, so just-in-time procurement came into being.

JIT purchasing principle

Just-in-time procurement sets the highest standard and is also the most objective, that is, the inventory of raw materials and purchased parts is zero. By streamlining the procurement process, we can eliminate the waste of time, energy and funds such as ordering, receiving goods, loading and unloading, invoicing, quality inspection, inventory, warehousing and transshipment, thus improving work efficiency and creating profits. The core of punctuality is to provide the right goods in the right quantity and quality at the right time and place.

Characteristics of JIT procurement

There are many differences between JIT procurement and traditional procurement in quality control, supplier relationship, supplier quantity and delivery date management.

1. Change from stock purchase to order purchase.

In the supply chain management environment, purchasing activities are carried out in an order-driven manner, and manufacturing orders are generated under users' needs and orders, and then manufacturing orders drive purchase orders, and then purchase orders drive suppliers. This just-in-time order-driven mode enables the supply chain system to respond to users' needs on time, thus reducing inventory costs and improving the speed and turnover rate of logistics. Therefore, orders play an important role in just-in-time procurement.

2. Change from general procurement management to external resource management.

External resource management is to infiltrate purchasing activities into the product design and product management control process of suppliers. Synchronous operation is an important idea of supply chain management. By synchronizing supply chain planning, all enterprises in the supply chain can take concerted actions in response to demand and increase the agility of the supply chain. The measure to realize synchronous operation is concurrent engineering. Manufacturers participate in the supplier's product design and quality control process, and formulate relevant product quality standards, so that the demand information can be well reflected in the supplier's business activities.

3. Change the general business relationship into a strategic partnership.

In the traditional procurement mode, suppliers are selected through price competition, and the relationship between suppliers and users is a short-term cooperation. When the supplier is found unsuitable, the supplier can be re-selected through market bidding. Under the JIT procurement mode, the relationship between suppliers and users is a long-term cooperative relationship, and the cooperative ability of suppliers will affect the long-term economic interests of enterprises, so the requirements for suppliers are relatively high. When selecting suppliers, comprehensive evaluation of suppliers is required. When evaluating suppliers, price is not the main factor, but quality is the most important criterion. This quality not only refers to the quality of products, but also includes the quality of work, delivery and technology.

4. Change the general delivery time to on-time delivery.

An important feature of just-in-time procurement is the requirement of on-time delivery, which is a prerequisite for accurate production. Timely delivery depends on the supplier's production and transportation conditions. As a supplier, we can start with the following aspects in order to deliver the goods on time: First, continuously improve the production conditions of enterprises, improve the reliability and stability of production, and reduce the phenomenon of delayed delivery or delayed delivery. At the same time, suppliers should adopt just-in-time production management mode to improve the punctuality of production process. Secondly, in order to improve the punctuality of delivery, the transportation problem can not be ignored. In logistics management, transportation is a very important issue, which determines the possibility of on-time delivery.

5. The need for information exchange is more timely.

Just-in-time procurement requires both the supplier and the buyer to enjoy high information to ensure the accuracy and real-time performance of supply and demand information. Due to the strategic cooperation between the two parties, enterprises can exchange information on production plan, inventory and quality in time so as to deal with problems in time.

6, formulate small batch purchasing strategy

Small batch purchasing is a basic feature of just-in-time purchasing. An important difference between JIT procurement and traditional procurement mode is that JIT production needs to reduce the production batch until "one flow production" is realized, so the materials purchased should also adopt the method of small batch. Of course, small batch purchase naturally increases the transportation times and costs, which is very difficult for multi-suppliers, especially when the suppliers are far away from abroad, it is even more difficult to implement just-in-time procurement. The solution can be mixed transportation, agency transportation, etc. , or try to use suppliers close to users.

Effective implementation strategy of just-in-time procurement

The successful implementation of JIT procurement strategy needs the following countermeasures:

1, as close as possible. The closer the space between suppliers and users, the better. If it is too far away, it is inconvenient to operate, and it is difficult to achieve zero inventory without giving full play to the advantages of JIT procurement.

2. Manufacturers and suppliers shall establish mutually beneficial strategic partnership. The implementation of JIT procurement strategy depends on the establishment of a new long-term and mutually beneficial relationship between manufacturers and suppliers, mutual trust, mutual support and mutual benefit.

3. Pay attention to infrastructure construction. Good traffic and communication conditions are the important guarantee for the implementation of JIT procurement strategy, and the infrastructure construction of common standards among enterprises is also very important for the implementation of JIT procurement. Therefore, in order to successfully implement JIT procurement strategy, both manufacturers and suppliers should attach importance to infrastructure construction.

4. Emphasize the participation of suppliers. JIT procurement is not only a matter for enterprise material procurement department, but also depends on the active participation of suppliers, which is not only reflected in the timely and high-quality supply of raw materials and purchased parts required by manufacturers, but also in the active participation of manufacturers in product development and design process. At the same time, manufacturers have the obligation to help suppliers improve product quality, improve labor productivity and reduce supply costs.

5. Establish an organization to implement JIT purchasing strategy. Enterprise leaders must understand the significance of JIT procurement from a strategic perspective and establish corresponding enterprise organizations to ensure the successful implementation of the procurement strategy. The composition of this organization should include not only the material purchasing department of the enterprise, but also the product design department, production department, quality department and financial department.

6. The manufacturer shall provide the supplier with comprehensive and stable production plan and operation data. Comprehensive and stable production plan and operation data can enable suppliers to make preparations in advance, carefully arrange production and ensure timely and guaranteed delivery. Otherwise, suppliers will have to resort to buffer inventory, thus increasing their supply costs. Some suppliers set up warehouses near manufacturers' factories to meet the requirements of JIT procurement of manufacturers. In essence, this is not a real JIT procurement, but a transfer of burden.

7. Pay attention to education and training. Through education and training, manufacturers and suppliers can fully understand the significance of JIT procurement, so that they can master the technology and standards of JIT procurement, so as to continuously improve JIT procurement.

8. Strengthen the application of information technology. JIT procurement is based on effective information exchange, and the application of information technology can ensure the information exchange between manufacturers and suppliers. Therefore, both manufacturers and suppliers must strengthen the application of information technology, especially internet technology, in order to implement JIT procurement strategy more effectively.

ZARA case

ZARA, a Spanish clothing brand, has won success with its quick response ability. Even if its sales amount reaches several billion euros, it still maintains a very fast response speed: 10~ 14 days of reactive production and distribution, while most enterprises in China need 90 days from receiving orders to listing products; ZARA launches new models of 12000 every year, while there are only about 4,000 models in China garment enterprises. ZARA's inventory turnover rate in a year is about 1 1 time, while China garment enterprises only have three times.

As an important part of ZARA supply chain, JIT procurement is indispensable. In ZARA store on Nanjing Road, manager Divina always carries a PDA around. This PDA has built-in modules such as ZARA ordering system and product system, and keeps close contact with the headquarters. Therefore, when Divina found that a product in her store was out of stock, she sent an order to the headquarters through a PDA connected to broadband. The recommendation quantification of ZARA headquarters is based on the daily sales data transmitted by each store, the product manager's prediction of the local market and the comprehensive analysis of historical sales data. Divina will place an order through PDA. Generally, it takes only three days at the earliest from ordering to delivery, and customers can get satisfactory clothes.

At present, manufacturers in China are mainly responsible for supervising the quality of purchased materials, and the acceptance department is responsible for the acceptance and confirmation of materials, counting points, and returning unqualified materials to suppliers, which increases the procurement cost. After the implementation of JIT procurement, the quality of procurement is fundamentally guaranteed, and the purchased raw materials and purchased parts can be delivered to the production line without inspection, which greatly reduces the procurement links and reduces the procurement cost.