The pull inventory control system begins with a customer’s order. With this strategy, companies only make enough product to fulfil customer’s orders.
One advantage to the system is that there will be no excess of inventory that needs to be stored, thus reducing inventory levels and the cost of carrying and storing goods.
However, one major disadvantage to the pull system is that it is highly possible to run into ordering dilemmas, such as a supplier not being able to get a shipment out on time. This leaves the company unable to fulfil the order and contributes to customer dissatisfaction.
An example of a pull inventory control system is the just-in-time, or JIT system. The goal is to keep inventory levels to a minimum by only holding enough on hand and not more or less, to meet customer demand.
The JIT system eliminates waste by reducing the amount of storage space needed for inventory and the costs of storing goods.
