In this article, I.B. Moore – conveniently located in Lexington, Kentucky (KY) and serving the surrounding area, including Cincinnati, Nashville, Columbus, and Indianapolis – is here to share the many benefits of Vendor Managed Inventory. Contact us today for all of your industrial manufacturing needs!
Vendor managed inventory is a theory based on integration in supply chain management. This option varies from the traditional style of inventory management. It is an optimized version of supply chain that assures that customers receive what they want whenever they need it, but by spending the smallest amount of money possible. This method makes the vendor the decision-maker. A retailer reports their inventory data with the vendor, who then figures out what the necessary order size is for both.
The vendor is given the responsibility for the ordering cost for the retailer, whereas the retailer must pay only for their own holding cost. This strategy is meant to eliminate stocking inventories that are unwanted, thus allowing for a reduction of costs that will not net a return. There are numerous benefits for this system of cooperation between retailers and suppliers.
The symbiotic relationship utilized by vendor managed inventory helps to decrease the amount of inventory in the supply chain, while also lessening the chances of a business running out of stock. Another positive effect is that the vendor representatives for the store can ensure that the staff understands the features of the products and that they are properly displayed in an organized manner.
The vendor benefits from this arrangement by having increased control over the displays. Their employees also have more contact with the customers. On the retailer’s side, they have reduced risk regarding their inventory. Additionally, their staff in the stores is able to have better knowledge about the product lines, which contributes to improving the brand loyalty for the retailer and the vendor.
The customers ultimately benefit from vendor managed inventory as well. The employees at the stores can provide more in-depth information about the goods for sale, and help customers select the products that best fit their needs. Customers are able to be given accurate, detailed product descriptions so they can find items that are most suited to them.
Manufacturing is another element that improves due to this inventory management procedure. Vendor managed inventory ensures that the warehouses due not suffer from an overflow of goods or from shortages. It also reduces the costs associated with labor, accounting, and purchasing. Since businesses are able to attain appropriate inventory, this leads to faster processing with lowered labor costs. Manufacturers also have access to the point of sale data of customers, which makes it easier for them to forecast.
I.B. Moore is a distributing and manufacturing company that provides vendor managed inventory services for our customers. We specialize in O-rings, seals, gaskets, rollers, and a variety of other elastomer products to suit a wide array of industrial needs. Our business has been offer custom-made elastomer products since 1967. Our high quality products are all manufactured, fabricated, and distributed from our facility. Our employees are committed to offering the finest possible products to ensure our customers are satisfied. We are located in Lexington, KY to proudly serve those that are within a 3-hour radius, including Cincinnati, Nashville, Columbus, and Indianapolis.