Inventory glossary

What is Just in time inventory?

Just in time inventory is a method of ordering stock to arrive close to when you need it, instead of holding large amounts of extra stock in advance.

Just in time inventory keeps cash free. If you order candles two weeks before you expect to sell them instead of three months before, that money sits in your bank account longer instead of sitting on a shelf as wax.

The risk is that it depends on reliable suppliers and accurate lead times. A small store running just in time has less room for error if a shipment is late, so it works best when you track lead times closely and order with enough buffer to cover normal delays.

Example

A candle store sells 20 units a week of its lavender candle. The supplier's lead time is 2 weeks. Instead of ordering 200 units to stock up for months, the owner orders 40 units every 2 weeks, timed to arrive just as the current batch runs low. This keeps less cash tied up in wax sitting on shelves.

Common mistakes

  • Running just in time with a supplier whose lead time is unreliable, which leads to stockouts.
  • Cutting stock too close to zero and leaving no safety stock for demand spikes.
  • Applying it to every SKU instead of just the fast movers where it makes sense.

Just in time inventory and SteadyShelf

SteadyShelf supports a just in time approach by calculating an order-by date per SKU from each supplier's lead time, so you order closer to need without missing the window.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Related terms

Lead time · Reorder point · Safety stock · Economic order quantity · Days of supply

Full inventory glossary

FAQ

Is just in time inventory risky for small Shopify stores?

It can be, if supplier lead times are inconsistent. It works best paired with some safety stock and a supplier you trust to ship on time.

Does just in time mean ordering with zero buffer stock?

No. Most stores keep a small safety stock even with just in time ordering, to cover late shipments or sudden demand increases.

Let SteadyShelf do this math for every SKU

Order-by dates per supplier, seasonal forecasts and draft POs for your Shopify store. $29/month after a 30-day free trial.

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