IMTS Insider

3 Reasons Manufacturers Might Use Vendor Managed Inventory

Category: Supply Chain Jul 20, 2020

By Kathy Keyes Webster, AMT Exhibitions Content Manager – Correspondence

Right time, right person, wrong part?
With disruptions occurring more frequently due to shutdowns caused by the pandemic, some manufacturers may want to consider Vendor Managed Inventory (VMI) or outsourcing your inventory for someone else to manage to ensure the right product goes to the right person at the right time.

“VMI can help manufacturers streamline supply chains and reduce costs, which in turn allows manufacturers to optimize their talent and production,” says Mike Kelly, Director of Enterprise Growth & Solutions at Arnoff Global Logistics, which provides VMI services. “VMI is especially effective for replacement parts.”

Here’s a look at three ways VMI can help manufacturers:

  1. Streamline Supply Chains: VMI uses data analytics, the Internet of Things (IoT), and Artificial Intelligence (AI) to visualize the workflow, inventory levels, and consumption. This helps manufacturers make better data-driven decisions and avoid shortages. Rather than storing replacement parts from a plethora of companies on-site, they can choose for the VMI to warehouse the parts and supplies in a nearby warehouse to be delivered when needed.
  2. Reduce costs: A VMI partner reduces the need for on-site inventory, which increases available space in a manufacturing facility. It also eliminates time-consuming steps for employees and frees them up to work on more complex tasks--allowing manufacturers to focus on what they do best:  design, innovate, and produce.
  3. Add Value: A genuine VMI partner focuses on offering efficiencies to boost operations for cost savings and quality. “As we get to know our customers, we offer them ideas to lower costs. We take pride in finding ways for our customers to remove steps and improve workflow—all leading to saving time and money,” says Kelly.

Since March, Kelly has received an uptick in requests to store replacement parts and inventory for OEMs, big-box stores, cleaning companies, paper mills, and even MRI service providers.

“Other companies are implementing the strategies Walmart and Amazon have been using for years,” says Kelly. “It’s great to see these companies maximize their supply chains.”

Rebuilding the Supply Chain
Whether you are an advanced manufacturer, job shop owner, or OEM, you are in the midst of your own supply chain challenges, uncertainties, and questions. In an extraordinary effort to support you, AMT and IMTS are dedicating significant staff and financial resources to help you rethink, reengage, and reestablish supply chains. Visit to learn more!

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