Just in Time Inventory Management Is Too Risky for Supply Chains
August 26, 2025
Just in Time Inventory Management Is Too Risky for Supply Chains, learn how minimal buffers leave operations vulnerable to disruptions.
Lean Strategy’s Dark Side
Just in Time inventory models once cut waste and slashed costs. But companies traded strength for speed. As a result, global networks faced sudden shocks. Teams dropped backup plans. In the end, many industries saw their supply chains snap under pressure.
Shelves Stripped Bare: Just in Time Models Under Pressure
During the 2020 pandemic, 21 percent of household paper products were unavailable in US stores (CSCMP). Simultaneously, panic buying triggered a 734 percent surge in toilet paper sales year-over-year. As a result, JIT buffers proved inadequate under sudden demand spikes, leading to persistent stockouts despite ramped-up production.
Freight Cost Frenzy: When Lean Fails
Between October 2019 and January 2022, freight rate indices climbed more than seven-fold, while Asia–US air freight prices nearly doubled. Consequently, lead times stretched unpredictably under Just in Time systems. Delivery commitments became difficult to uphold, and budget forecasts were repeatedly missed as shipping costs fluctuated wildly.
Risk Blind Spots
Only nine percent of firms ranked supplier risk management as a top priority in 2021. Nevertheless, resilience planning was deemed secondary in most strategies. Furthermore, cascading failures in supplier networks often went undetected. Consequently, large-scale disruptions were triggered by single-point failures. Thus, risk was underestimated until systems collapsed under pressure.
Suez Canal Meltdown
When the Ever Given blocked the Suez Canal in March 2021, $9.6 billion in daily trade was halted. Port congestion forced thousands of vessels to wait. Which paused manufacturing lines across multiple regions. Global disruptions were projected to cost firms $184 billion annually by 2025. In response, safety stocks and regional sourcing were embraced to shore up Just in Time frameworks.
