JIT's core benefits exclude purchase cost reductions

Steps:

• Recall JIT definition: Inventory system producing/delivering goods only as needed to minimize stock levels.
• Identify key advantages: Lower holding costs, space usage, and waste from excess inventory.
• Evaluate options: Match A, C, D to standard benefits; B relates to supplier pricing, not JIT mechanics.
• Conclude B as non-advantage since JIT prioritizes flow over cost negotiation.

Why B is correct:

• JIT reduces inventory volume and timing issues but does not inherently lower purchase costs, as smaller, frequent orders may increase unit prices per supply chain principles.

Why the others are wrong:

• A: JIT ties up less capital in unsold stock, directly cutting investment.
• C: Minimal inventory frees up warehouse space.
• D: JIT cuts overproduction and obsolescence, reducing waste.

Final answer: B