Vendor managed inventory represents partnering between the supplier and the customer. It lowers mutual operating costs, optimizes shipment quantities, and achieves excellent service levels for the distributor's customers. . It does this by using advanced forecasting techniques. Freight costs are reduced, human errors are virtually eliminated, accounts payable processing is speeded up, inventory turns are maximized, and operating costs minimized while achieving the service level specified by the distributor. The system is now in place at over 200 different locations.
Sales are up.
There is a daily inventory review. Costs are down, and profits are way up. They are providing far better service to their customers. Out of stock conditions have been reduced to an absolute minimum, which, in turn, helps the distributors keep their customers. It's very nice to send birthday cards, newsletters, provide gold cards, or have customers accumulate points or air miles, but the EDI-VMI system goes way beyond that.