The idea behind a vendor managed inventory system is to give both sides the ability to help control the flow and availability of goods. It will require extensive sharing of information to ensure the visibility of goods at a customer location. This means customers won’t have to reorder once the supply is exhausted. Instead, suppliers will keep the stock replenished for the appropriate customer demand. Here are three useful tips for making it flow smoothly.
Clarifying Expectations
There should be plenty of discussions about how the vendor managed inventory system benefits all parties involved. Most are prone to being disappointed with short-term results. Constant and clear communication between customer and supplier is ideal. The two parties need to work together to assure proper planning on both sides so it runs smoothly.
Agreeing on Shared Information
The odds of an efficient system improves when suppliers and customers agree to share vital information on restocking. This doesn’t call for the sharing of proprietary information. However, both parties should share enough information to keep the steady flow of goods. Customers need to be willing to share forecasts or production schedules with suppliers.
Keeping Communication Open
When two parties are implementing a vendor managed inventory system, they need to discuss their goals and processes. Once the program has been implemented, each side must realize there will be some miscues. These can be studied and turned into learning opportunities to avoid being repeated in the future.