How Vendor Managed Inventory (VMI) Reduces Supply Chain Waste-2-of-7-Inventory-Waste

Inventory waste is defined as having too many of the wrong parts or items in stock, not enough of what is needed, and too much in unfinished goods or work-in-progress (WIP) inventory.

How VMI Services Reduce Inventory Waste
One of the most significant benefits of vendor managed inventory (VMI) services is to provide the OEM’s production floor with the right parts in the right place at the right time and in the right quantity needed.

It sounds simple enough, but when dealing with low-cost, high-volume C class parts, an OEM has to consider that these parts typically account for the highest number of SKU’s and can be extremely difficult and costly to manage internally.

How does VMI work?

  1. An effective VMI program incorporates a “pull” system: parts are only replenished after use and typically run on a 2-bin Kanban system to allow time for replenishment to arrive before the second bin is depleted.
  2. The VMI provider and the customer/user work together to make sure there is a consistent flow of inventory.
  3. Ongoing communications minimize over-stocking, shortages and product obsolescence.
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Reliable Stock™ Lean VMI Solutions by Falcon

Falcon’s Reliable Stock™ lean VMI program delivers 100% production uptime efficiency and reduces your lead times, while lowering your overall inventory investment in class C production components and fastening supplies. Download the Reliable Stock™ brochure today to find out how you could be saving time and money.
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2018-11-19T10:00:31-04:00November 12th, 2018|Categories: Inventory Management, Vendor Managed Inventory (VMI)|

About the Author:

Aaron is the Marketing Director at Falcon Fastening Solutions, Inc. He is focused on sharing Falcon's unique approach to fastening and class C production component supply chain solutions with equipment manufacturers.

Fasteners and Class C Component Supply

Falcon supplies fasteners and inventory management services to manufacturers in North and South Carolina, Kentucky, and the surrounding areas.

Charlotte Office

10715 John Price Road
Charlotte, NC 28273

Phone: 800.438.0332

Mobile: 704.588.4740

Mailing Address

P.O. Box 7429 | Charlotte, NC 28241-7429

Phone: 704.588.4740

Fax: 704.588.5753

Kentucky Office

11536 Commonwealth Drive
Louisville, KY 40299

Phone: 502.266.6292

Fax: 502.526.5567