Materials managers should be aware of the legal implications of JIT (just-in-time) distribution systems

As a part of a just-in-time, single-source procurement plan, a supplier agreed with the hospital that the supplier would hold at its warehouse the bulk of a large order for medical supplies. The hospital signed a contract for the entire amount of the order and, under the terms of the contract, title passed at once to the hospital. Each day the hospital was to advise the supplier by telephone of the quantities consumed. The supplier would deliver to the hospital daily the items needed. In this dialogue, Dr. Decker discusses the legal issues in such an arrangement, including a word of warning.