In this paper, we consider an inventory system where a single supplier purchases and processes raw materials into finished goods in order to deliver finished goods to a single buyer for effective implementation of Just-In-Time Purchasing. An integrated multi-item lot-splitting model of facilitating multiple shipments in small lots between buyer and supplier is developed in a JIT Purchasing environment. Also, an iterative solution procedure is developed to find the order quantity for finished goods and raw materials, and number of shipments between buyer and supplier. We show by numerical example that when the integrated policy is adopted by both buyer and supplier in a cooperative manner, both parties can benefit.