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1、Top 10 Reasons Not to Try VMI And why you should reconsider!By: Janice BurkJanice Burk leads the Vendor Managed Inventory (VMI) team for Rockwell Automation. Over the past five years, Rockwell has been using Enterprise Data Managements VMI solution Datalliance . Based on their VMI success with key c
2、ustomers (distributors) over this time period, Rockwell has recently embarked on an effort to increase the percentage of their domestic business handled by VMI from 20% to 70%. Realizing this substantial increase in VMI throughput will require the support and cooperation from Rockwells customers. In
3、 anticipation of their questions, Janice wrote this response to proactively address customer concerns and illustrate the benefits of VMI.Reason #10: Our GMROI and turns are acceptable with our present procurement procedure. Why change a known, working system to an unknown? Even if you are doing well
4、 with your present procurement procedures, you will realize improvements and generate direct, bottom-line results using VMI. As with all process changes, proceed carefully. Make sure the process you are adopting is solid and accounts for many of the details your current system supports. Document res
5、ults before and after. To increase your comfort level, pilot the new program for a period of time with a segment of your product line or locations.Reason #9: Our previous VMI trial wasnt successful. Why try again?Dont let a single bad experience with VMI color your perspective forever. A bad carpent
6、er can build a poor house, even if he is using good tools. A bad experience should teach you to be careful, but it should not stop you from trying again. VMI has helped many leading companies reduce inventory, improve customer service and increase sales. Reason #8: We dont need every SKU rounded to
7、package quantity. Sayan item is packed in fives. We need to order just one, since five would be a ten year supply. The rounding policy could swell our inventory unnecessarily.Unnecessary package rounding can adversely effect turns. However, a reasonable rounding approach will significantly lower the
8、 transaction cost for both parties. It wouldnt be efficient to pull, count, pack, ship, receive, count, and put away 99 pieces of a $1 item that came in packages of 100. Package rounding can speed the entire process and save everyone time and money. Datalliance is a robust VMI package with very flex
9、ible package rounding methodology with configurable limits. Work with your supplier to ensure that the package rounding process you implement makes sense for your business.Reason #7: Our Inventory Management System is a state-of-the-art system and superior to what our suppliers are using. So why sho
10、uld we downgrade? Why pay good money for our Inventory System and not use it?A great advantage of an integrated supplier-distributor replenishment program is the ability to leverage systems for more streamlined supply chain execution. From business intelligence standpoint, you may have information a
11、bout future demand that will influence the way the product is ordered. There are several ways for you to determine how product is managed and at what replenishment level. With the supplier involved in the process, you have more accurate data on lead times, product groupings, package quantities, etc.
12、 This data improvement produces better results. Additionally, when the supplier manages the day-to-day orders, your staff can focus on more complex aspects of your business.From a functionality standpoint, Datalliance stores and uses daily data to differentiate items that sell one a day from those t
13、hat sell 20 at a time once each month. Datalliance has 11 different planning groups to handle a wide variety of movement patterns. Datalliance is exception driven, a feature that minimizes human intervention and provides outstanding recommendations. The application was written within the last five y
14、ears and takes advantage of todays processing and storage power. And, the system is routinely enhanced to include the best inventory management practices based on the experiences of suppliers, representing hundreds of locations worldwide.Reason #6: VMI cannot tell the difference between a sales orde
15、r and an inventory problem known as negative inventory. Will we get items shipped that we dont want?Data integrity is always important, and no system can completely identify bad data. However, Datalliance has several levels of data filtering to highlight suspect data and does a good job of eliminati
16、ng bad data. Inaccurate data in any system carries hidden costs in increased inventory, bad fill rates, and additional workload. With or without VMI, good data is good business.Reason #5: We deal in special items with our supplier. Many items do not have UPC codes. How will these problems be handled efficiently?Datalliance allows items to be matched through catalog IDs or even a simple cross-reference. This early matching process not only ena
