Smoothed Production Helps Toyota Adapt to Demand Changes and Reduce Inventory

The ultimate purpose of the Toyota production system is to increase profit by reducing costs. Cost reduction is achieved by eliminating waste; waste is exposed and eliminated by Just-in-time (JIT) production. In sales, the JIT concept will be realized by supplying the salable products in salable quantities only. This situation is characterized as production which is promptly adaptable to demand changes. As a result, excess inventories of finished products can be eliminated.