Since the demand for tyres is progressively increasing in in Middle East, Apollo tyres decided to establish their manufacturing unit in Sultanate of Oman. They selected Duqm SEZ as their location. Since all the raw material needs to be imported from countries like India, and the finished products need to be exported to other GCC countries, Apollo decided to give a special attention on inventory management of the company. The management of Apollo realised that an integrated system of inventory control is a must to reduce overall production cost of the company.

The company decided to follow JIT system as their inventory control model. Since the company doesnt have any previous experience in using this system, the management decided to consult you to reach a final decision. Now your report on JIT is very important for company to decide whether to continue with the system or move to some other system.

You are required to prepare a report stating: -

1. Explain how implementation of JIT pertaining will help in the reduction of inventory costs in Tyres manufacturing business. (5 marks)

Explain the PULL and PUSH system applicable to Tyres manufacturing business with the help of a diagram.