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Vendor Managed Inventory allows MCB to manage stocks throughout the supply chain, including the stocks held by customers! So we offer ‘adequate availability’ instead of an ordering process.

When VMI is used, MCB assesses the stocks held by the customer and decides when inventory levels need to be replenished based on the agreed minimum and maximum levels. MCB independently decides when to replenish stocks, resulting in reduced transport movements.

VMI offers the greatest benefits when there is a constant and regular flow of goods, however VMI can also be beneficial in the case of low-volume, irregular consumption.

In general, VMI offers increased service and a reduction in the average inventory. In addition, VMI can have the following advantages:

  • Guaranteed stock availability due to continuous measurement of inventory levels and timely replenishment. This results in a faster speed of reaction and greater adaptability to fluctuations in demand;
  • A reduction in the number of rush orders and deliveries because the supplier receives up-to-date inventory information and, in some cases, forecast information provided by the purchaser;
  • Simplification of the order and invoicing process. Delivery of the goods is equivalent to a purchase order, meaning that self-billing is easy to apply;
  • Increased trust in the relationship between both parties makes it possible to align the supplier and purchaser's processes even more precisely;
  • Better production planning on the part of the supplier because the production plan can be matched to the time of delivery and the volumes for purchasers. In addition, production planning can be further optimised if the supplier is also allowed to flexibly determine the delivery quantity (conditional to guaranteeing availability).

    Being able to rely on timely stock replenishment at all times is a primary prerequisite for applying VMI. In addition, appropriate agreements must be made about how the financial benefits are shared and how investment expenditure is allocated.

    We strive to achieve a common goal - matching the supply of goods to demand more effectively - in order to reduce average inventory and costs without adversely affecting our service to customers.


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