Vendor Managed Inventory

Mumbai, India (PressExposure) January 15, 2010 -- Vendor-managed inventory- implement eresource ERP

Vendor-managed inventory (VMI) is a process where the manufacturer generates orders for the distributor ( based on demand information sent by the distributor using Enterprise Resource Planning (ERP) system . During this process, the manufacturer is guided by mutually agreed objectives for inventory levels, fill rates and transaction costs.

VMI is a planning and management system that is not directly tied to inventory ownership. Under VMI instead of the distributor monitoring sales and inventory for the purpose of triggering replenishment orders, the vendor assumes responsibility for these activities.

In the past, many manufacturers operated vendor-stocking programmes where a representative visited a distributor a few times a month and restocked their suppliers up to an agreed level. VMI replaces these visits with information gathered from cash registers and transmitted directly to a manufacturer's computer system via ERP. Now, manufacturers can monitor sales of their products and decide when to initiate the replenishing procedure.

To understand VMI, let us look at to business models:

The Conventional Business Model: When a distributor needs a product, they place an order against a manufacturer. The distributor is in total control of the timing and size of the order being placed. Under this model, the distributor maintains their inventory plan.

Vendor Managed Inventory Model: The manufacturer receives electronic data that informs it about the distributor's sales and stock levels. The manufacturer can view every item that the distributor stocks as well as the true point of sale data. The manufacturer is responsible for creating and maintaining the inventory plan. Under VMI, the manufacturer generates the order, not the distributor.

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About eresource infotech Pvt Ltd

The year 2003 saw the birth of a new Information Technology firm, eresource Infotech. A young and dynamic Sudheer Nair founded the company armed with a handful of talented and dedicated hardcore professionals, who have made their stamp in their respective fields in the Information Technology.
In a short span of 6 years, since stepping to the information technology arena, with the aim of contributing dedicated services in the ERP field, today eresource ERP has become a name to reckon with.for more information :

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Press Release Submitted On: January 15, 2010 at 5:23 am
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