Vendor Managed Inventory (VMI) and Collaborative Replenishment is a proven approach to streamlining inventory management and order fulfillment that improves collaboration between suppliers and their distribution partners by aligning business objectives and optimizing operations for all participants. 

You may be asking, what is the difference between VMI and Collaborative Replenishment. It’s simple, Collaborative Replenishment is an evolution of VMI that includes trading partners working together to ensure an efficient inventory management program. It goes far beyond the capabilities of what traditional VMI is thought of including things like truck building, available to promise and more. It offers companies more choices by enabling orders to be launched by any trading partner, offering multiple routes to market, and utilizing various types of demand signals. In all, collaborative replenishment is a more flexible approach to supply chain management, but at is core Collaborative Replenishment includes VMI and all its benefits.
 

Increase Sales and Supply Chain Efficiency, Reduce Errors and Time Draining Rework

VMI changes the traditional ordering process by empowering suppliers to recommend orders for distribution partners. Combining data from both supplier and seller, this collaborative approach improves supply chain performance through improved order accuracy and reduced rework. Other benefits include faster inventory turns, higher in-stock percentages and increased sales.

What is VMI Process

How VMI Works

  • TrueCommerce Datalliance receives data (called a Product Activity Report) from a distribution partner 
    • This report contains data about things like sales, product transfers and inventory positions (on hand, on order, in transit)
  • Our VMI platform reviews the data and sends a recommended replenishment order based on key factors and agreed objectives 
  • The supplier reviews and approves the recommendations 
  • The VMI platform then sends a PO to the supplier and a PO acknowledgement to the distribution partner
  • Once the partner approves the PO, the order can be shipped

“TrueCommerce Datalliance is the only one that provides online information, charting and graphing to give us clear insight into the status and execution of our supply chain. When needed, we can drill down to the appropriate level to identify the cause of an inventory trend or issue. Our buyer and the manufacturer’s planner can then collaborate on the most appropriate course of action.”

Rick Bumpus
Executive VP and COO
North Coast Electric Company

Monitoring and Reporting

When supply chain partners begin using VMI, they agree upon objectives for: 

  • Inventory turns 
  • Fill rates and in-stock percentages 
  • Transaction costs

The VMI platform monitors actual activity with measurements against those objectives. Data is always available to all parties on demand. The system also alerts all parties when measurements fall outside acceptable ranges or data anomalies are detected (e.g., missing/incomplete data).

Benefits for Participants

A TrueCommerce Datalliance VMI program enables participants to:
  • Ensure program success with powerful capabilities combined with expert VMI support and services 
  • Minimize program costs with a highly cost-effective and predictable annual fee, based primarily on the number of locations 
  • Stay on the leading edge with continual innovation and evolving best practices driven by input from our diverse global customer community

Customer Success Stories

Hubbell

Hubbell Reduces Cost and Effort While Improving VMI Program

nVent Optimizes Shipments & Increases Profits with VMI from TrueCommerce

Siemens Industry and Viking Electric

Siemens Industry and Viking Electric collaborate to improve performance

VMI At Ocean Spray—A New Chapter

Ocean Spray VMI Analyst productivity increased 20%

View all Success Stories

Key Features of the VMI Solution

  • Leading-edge data acquisition, replenishment order generation and analysis tools to streamline the VMI process end-to-end 
  • A wide range of advanced capabilities enable VMI partners to automate more tasks and perform more functions than you would ever expect from “traditional” VMI 
  • Expert support and services from the TrueCommerce Datalliance Customer Care team—so you can focus on serving your customers

    Get More to Grow On with Collaborative Replenishment

    Why stop at VMI? Collaborative replenishment offers even more ways for growing partner networks to manage replenishment together. Collaborative replenishment: 

    • Empowers any supply chain partner to suggest or recommend an order 
    • Offers multiple routes to market 
    • Utilizes more demand-signal types
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