In a speech by John E. Pepper, former CEO of Procter & Gamble (P&G), the following observation was made:

"Efficient Replenishment is basically just-in-time inventory management...... We eliminated excess inventory..... But we also discovered some other benefits, as well. Perhaps the most surprising was that this strategy increased product freshness."

For the purpose of answering this question, just-in-time is just a strategy to reduce inventory (details are irrelevant). Assume that P&G's total sales (flow rate) did not change. Please briefly justify Mr. Pepper's argument that decreasing inventory will result in greater product freshness.

Answer rating: 100% (QA)

Mr Peppers argument that decreasing inventory will result in greater product freshness can be justif... View the full answer