Which of the following best describes 'just in time' inventory systems?

'Just in time' inventory systems are characterized by the principle that supplies and materials arrive only as they are needed in the production process, rather than being held in large quantities on-site. This approach minimizes inventory costs, reduces waste, and optimizes efficiency within a business.

By implementing a just in time system, companies can decrease the amount of capital tied up in inventory, as they only order and receive items when they are required for production or sales. This strategy allows businesses to respond more flexibly to changes in market demand, as they are not burdened with excess stock that may become obsolete or unusable.

In contrast, the other options describe different inventory practices. Keeping large quantities on-site leads to higher storage costs and risks of obsolescence. Manufacturing products ahead of time can create excess stock that may not be sold immediately, which again ties up resources unnecessarily. Shipping stock at the end of the month implies a bulk handling approach that does not align with just in time principles. Thus, the description that supplies arrive only as they are needed captures the essence of a just in time inventory system.