Advantages of VMI (from the recipient’s and supplier’s perspectives)

Advantages for the recipient (manufacturing or trading company):

  • easy purchase planning
  • fast component purchase order lead time
  • stock reduction (reduction of warehousing costs)
  • minimisation of shortages of manufacturing resources
  • flexibility of action and susceptibility to changes in manufacturing plans
  • safety of the solution

Advantages for the supplier:

  • lower freight costs thanks to shipping larger amounts of goods
  • control over the stock until it leaves the warehouse
  • ensuring higher flexibility of component delivery lead times
  • minimising forecasting errors
  • mutual pricing agreements between the recipient and the supplier – both parties obtain
  • considerable room for manoeuvre during negotiations