![]() Paul Przyby, Vice President of Sales & General Manager at Optimas Solutions, has observed the evolution of supply chain management up close for the past several decades. The purpose of supplier reduction, also known as vendor consolidation, is to reduce the number of suppliers within a specific supply market in order to save money. Supplier reduction initiatives and emerging technologies continue to accelerate the adoption of VMI. The vendor is solely responsible for making sure that the right items, go to the right places, at the right time.īut VMI is bigger in scope and benefits than just ‘managing parts.’ It’s about streamlining your supply chain, reducing costs, having higher visibility into your part consumption, and reallocating human resources away from slow, manual, error-prone work to more quality-focused, value-add responsibilities. In simplest terms, VMI is letting someone else (a vendor) manage your inventory. New technologies like artificial intelligence (AI) and the Internet of Things (IoT) now allow organizations to optimize their VMI programs and help them to continue to innovate and improve supply chain management. In the thirty years since then, inventory management has evolved to become more accessible for companies of all sizes. Vendor Managed Inventory (VMI) or inventory management, has been around since the 1980s when companies such as Walmart used it to revolutionize their supply chains. Here’s a look at five reasons why Vendor Managed Inventory (VMI) is a growing practice to streamline your supply chain, reduce costs, increase part consumption visibility and redeploy labor for more important activities.
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