Some VMI benefits
Shorter lead times
- Sharing information means knowing what your customers need in advance,
allowing you to plan accordingly and deliver promptly
Having a future view into clients’ needs allows you adequate time to
plan for what is needed and move towards a ‘just in time’ business model
Reduce obsolescence - less likelihood of holding on to excess stock that
could become obsolete
Less inventory, less money tied up in the warehouse
Having the ability to offer VMI to potential customers is a huge benefit
and service offering
Companies offering VMI are better able to manage their ordering and
customer delivery – increasing service levels
Being able to offer shorter lead times and timely delivery help you
stand apart from your competitors
The system/software becomes a sales tool – show customers what you can
do and provide proof that you manage an efficient business
Some clients may insist on VMI
More leveraged relationship for the supplier – Clients are less
likely to look elsewhere because your service is exemplary
In choosing the proper system to handle your VMI needs, there are a few
pitfalls to watch for
Expect your customers to provide data over a variety of mediums
(FTP, email, EDI VANS, internet, etc.) and in varying formats
(ASCII, Excel, EDI, XML, etc.). No two customers are likely to have the
same transmission capabilities and convincing a customer to send you
data exactly as you want it is a rare occurrence.
Look for an extremely user-friendly system that is intuitive and
requires little to no technical maintenance from users and IT staff
alike. Many attempts at VMI fail because the software is too cumbersome
and there are too many manual processes required by the
Find a system that can add new VMI clients quickly and
efficiently. Once sales has convinced a client to sign up and/or go the
VMI route, if it takes too long to start, momentum is lost and the
process may fail if too much time passes.
A VMI system should include a demand planning engine, not
just software that takes in data and provides reports. Some clients
will need you to create forecasts, consider lot sizes, order minimums,
lead times, safety stock, safety time, frequency of shipments, and a
variety of other demand planning tasks. It is not enough to simply
The software needs to be a manage-by-exception system with
full reporting capabilities included. When you have thousands of SKUs,
you need a system that points out the ones that need attention and
filters out the ones that do not.
How SCP 4.0 can help your
business VMI needs
Our SCP 4.0 product can process electronic information in virtually any
format (Excel files, ASCII, EDI, XML, exported reports, and more) and
also automates the receipt of this information to a great degree.
Initial setup of the system takes approximately 2 weeks and after that
new clients can be added in a matter of a few days. It is a full demand
planning and forecasting package that provides automation at such levels
that it can actually communicate with users, clients, management, IT,
etc., by email and other means.
Note that a single site license of SCP 4.0 (no restriction on the number
of users) will handle an unlimited number of VMI relationships, and is
also capable of managing your internal inventory planning and
replenishment requirements as well. If you feel there are opportunities
in inventory reduction and service level improvements, this product will
address almost all your inventory management needs.
We have plenty of references standing by. When you are
ready to speak with someone, just let us know and we will put you in
touch with some of our clients.
We can provide a custom demo using your data. This will
take about an hour and a half and can be done via GoToMeeting online.
There is no cost and it is helpful when people see their own data and
possible benefits to their business.
In addition, we have a Proof of Concept (POC) offer. This
is a travel-cost-only visit to your office for 2-3 days. During that
time, we will implement 1 VMI partnership using SCP. We can usually get
about 70-80% of the functionality running in those 2-3 days, but
definitely enough for people to make an informed decision. Our time and
use of the software are complimentary for a POC. You will then be able
to use the program free of charge, testing the VMI relationship for 2-3
weeks. This allows you to confirm the compatibility and benefits of SCP
at a minimal investment prior to scheduling a full implementation.