Supply chain collaboration has become a more strategic effort in today’s demanding business environment as a way to create new sales revenue opportunities, greater efficiencies, and customer loyalty. One method of collaboration is the utilization of Vendor Managed Inventory (VMI) by suppliers to monitor and replenish a distributor’s inventory.
Howard Coleman, principal of MCA Associates, suggests that when talking about VMI, distributors and manufacturers go beyond the notions of logistics and the physical and tangible activities, to relationship building and management, to the behaviors of each partner, as well as other intangibles.
Distributors may only consider VMI as “a different method to procure stock”, but for “real” VMI success, several concepts and ideas need to be understood.
Coleman’s article, Vendor Managed Inventory – What’s True Collaboration?, outlines the collaborative objectives of VMI and how understanding the full scope of a VMI relationship can benefit your business. Click the link above to read why distributor and supplier have a lot to understand and agree on for successful VMI.
Howard W. Coleman, Principal, MCA Associates
MCA Associates, a management consulting firm since 1986, works with wholesale distribution and manufacturing companies that are seeking operational excellence. MCA Associates is a frequent contributor to industry publications such as The Wholesaler, Electrical Wholesaling, Industrial Supply Magazine, among others. To access some great articles on Lean Tactics and Operational Excellence in Distribution click here.