What is Kanban?

Kanban is a Just in Time (JIT) concept where orders for more inventory are sent only when current inventory is empty or low. In practice, the customer has two bins of the required product. When one bin is empty or running low, its sent to the supplier for restocking while the other bin is used.

What are the Benefits of Kanban?

Unlike a traditional forecast based MRP system which is prone to both shortages and excesses, the Kanban system is relatively immune to both of these issues. The cycling between the two bins protects against shortages while the ordering of new inventory only when necessary prevents overflows.

E-Kanban vs Manual Kanban

Even with all of Kanban’s benefits over MRP, a manual Kanban system can be slow and inefficient. Mailing times, business hours, and human error can severely limit or impede the system, causing trouble within the supply chain. That’s why an Electronic Kanban (E-Kanban) system is superior to a manual one. In an E-Kanban system, barcodes are scanned using a scanner and the status is sent to suppliers electronically. There, orders can be fulfilled instantly and without human interaction and are sent back to the customer. This solves the aforementioned problems and allows the supply chain to flow smoothly