The impact of Just-in Time inventory system on cost efficiency using Economic Order Quantity model in manufacturing firms
Safikah Samsudin, Nurshamimah Samsuddin

Faculty of Technology Management and Technoprenuership, Universiti Teknikal Malaysia Melaka

Abstract

In today^s highly competitive manufacturing landscape, firms are under constant pressure to reduce operational costs, improve efficiency, and enhance customer satisfaction. This study investigates the impact of the Just-In-Time (JIT) inventory system on cost efficiency, with particular focus on its integration with the Economic Order Quantity (EOQ) model as a hybrid approach to inventory management. While JIT emphasizes minimizing stock levels and eliminating waste, EOQ provides a structured method for determining optimal order sizes to balance holding and ordering costs. This research examines whether the combined application of JIT and EOQ offers a more cost-effective strategy compared to adopting each model independently. A quantitative research design is employed, targeting medium and large-scale manufacturing firms in developing economies, with Malaysia as the main context. The data collection is conducted through structured surveys, and statistical analysis is applied to assess the relationship between hybrid inventory strategies and cost efficiency. The findings are expected to demonstrate that integrating JIT and EOQ are not only reduces inventory-related costs but also enhances productivity and responsiveness to customer demand. The study contributes practical insights for manufacturing managers seeking to strengthen competitiveness and provides a framework for policymakers and academics advancing inventory optimization strategies in emerging markets.

Keywords: Cost Efficiency, Economic Order Quantity, Inventory Management, Just-In-Time (JIT)

Topic: New Media: Impacts, Benefits, and Barriers