Just-in-Time (JIT) is a Japanese management philosophy which has been applied in practice since the early 1970s in many Japanese manufacturing organisations. It was first developed and perfected within the Toyota manufacturing plants by Taiichi Ohno as a means of meeting consumer demands with minimum delays. Taiichi Ohno is frequently referred to as the father of JIT. Toyota was able to meet the increasing challenges for survival through an approach that focused on people, plants and systems. Toyota realized that JIT would only be successful if every individual within the organisation was involved and committed to it, if the plant and processes were arranged for maximum output and efficiency, and if quality and production programs were scheduled to meet demands exactly. Just-in-Time(JIT) technique tries to ensure that there are no zero inventories, and goods are produced or ordered only when they are needed. In actual practice zero inventories may not be possible but the term Just-in-Time states the direction in which lot size should be headed. Just In Time (JIT) is an inventory strategy implemented to improve the return on investment by reducing in-process inventory and its associated costs. When implemented correctly, Justin-Time can lead to dramatic improvements in a manufacturing organization’s return on investment, quality, and efficiency. Main drawback of the just-in-time system is that the re-order level is determined by historical demand. If demand rises above the historical average planning duration demand, the firm could deplete inventory and cause customer service issues. To meet a 95% service rate a firm must carry about 2 standard deviations of demand in safety stock.