Reader M.K. asks, "What can you tell me about vendor-managed inventory (VMI)? Our company is considering moving to this practice." A vendor and buyer partnership that uses VMI enables participants to improve the efficiency of their material flow. The supplier is given the task of keeping the wholesaler's warehouse stocked with the supplier's products, enabling alignment of operations with the needs of the retailer. VMI is especially beneficial when it involves long lead times from international producers coupled with high variability of incoming order volume from wholesalers and large retailers.
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