Supplier-controlled inventory planning with VMI

Imagine if you could easily automate the continuous supply of raw materials, consumables and supplies. Vendor Managed Inventory, or VMI for short, enables just that: digital networking between buyers and suppliers to ensure optimal production flow.

16. December 2020 | Blog

While purchasing departments in large corporations have been using VMI for some time, this concept is still not very widespread in medium-sized procurement organizations. Yet it creates a clear win-win situation: In purchasing, the scheduling effort and cost-intensive warehousing are reduced. At the same time, your suppliers increase the efficiency of the flow of goods and save on superfluous safety stock. At the same time, you strengthen the relationship with your supplier base in the long term.

Secure Supply with Networked Procurement Processes

The Onventis VMI module enables monitoring of current inventories, receipts and issues of materials relevant to MRP, as well as automatic generation of order proposals. The basis for all calculations are the results of material requirements planning from the ERP, which are typically based on a company’s sales and production planning. This requirements and inventory information is read in via an interface with the relevant material master data. For SAP customers, an add-on is available for this purpose that automatically provides the data in the required format. Procurement requirements and ranges of coverage are then determined in Onventis. Order proposals are automatically generated on the supplier side and confirmed in Onventis.

The new VMI module thus not only simplifies your entire inventory management, it also sustainably improves material flow costs. For example, you work with a smart inventory and requirements preview based on ERP planning data and digitize receipts and issues end-to-end.

The Advantages of the VMI Solution

  • Demand-driven alignment of production and delivery planning
  • Optimal networking between supplier and customer
  • Reduction of material flow costs
  • Avoidance of delivery bottlenecks
  • Overall: cost optimization and risk minimization

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