5 Benefits Your Vendor-Managed Inventory Partner Should Provide
The goal of a solid Vendor Management Inventory (VMI) program is to provide a mutually beneficial partnership between a supplier and its customer to ensure a smooth and accurate flow of goods between the two organizations. At Quest, we handle the complex challenges of inventory planning for customers operating in highly structured industries such as pharma and life sciences, where stocking levels can impact the bottom line.
At a time when keeping your workers, facilities, and products safe means ensuring you have the inventory you need to stay operational, partnering with a trusted VMI team can be a powerful tool in making sure your workers have what they need when they need it. To help make sure you are getting the most out of your VMI program, we are sharing five key benefits your Vendor-Managed Inventory partner should provide.
1. Increased Service Tailored to Your Unique Needs
A solid VMI program should always ensure you have no more and no less than what is absolutely needed to have onsite. When we kickoff a new VMI partnership here at Quest, we assign a VMI Specialist who is focused on a customer’s most important product and stocking needs. Rather than taking control away from the customer, we work together to analyze monthly usage needs to determine minimum and maximum inventory levels.
2. Improved Operational Efficiencies
The main benefit of VMI is to help your business run smoother and operate more efficiently. This can mean different levels of service for different organizations. At Quest, we can have VMI specialists perform inventory counts and deliveries each week, or we can have a specialist located onsite at all times. With part-time and full-time VMI, customers can focus their employees’ efforts on the work that generates company revenue. Additionally, VMI teams can help identify issues such as product expiration dates, tracking lot numbers, and managing important paperwork such as Certificate of Conformity.
3. Reduced Inventory Overstocks & Stock Shortages
VMI removes the need for the customer to have significant backup stock because the vendor manages the resupply lead times. Lower inventories for the customer can translate to significant cost savings.
Quest’s VMI team stocks and tracks customer inventory to ensure they have the products they need when they need them. Many times VMI teams are used in time-sensitive industries that also have regulatory demands. A pharmaceutical manufacturing production line running out of supplies can cause that line to shut down temporarily, costing the company tens of thousands of dollars. A strong VMI team ensures that doesn’t happen.
4. Onsite Technical Expertise
Working with a VMI specialist who understands your business is key. Quest carefully assigns a team specifically trained to work within your industry. This way, you can be sure the VMI team understands the requirements of your business, the timeframes you work under, and how product stocking affects your employees, products, and bottom line. If a problem arises with a product, VMI specialists with technical experience understand possible implications and can react quickly to offer various solutions.
5. Financial Transparency
Your vendor’s Sales and VMI team should be meeting with you regularly so you are aware of what stock is being used in your company and how much of it. They can also help explain why product changes were made by your safety managers or industrial hygienists. Quest performs site-specific reporting and spend usage that allows our customers to make better-informed business decisions and eliminate wasteful, non-value adding factors and other costs associated with inventory errors.
Better communication, inventory accuracy, forecasting and overall service are all possible through VMI. A good VMI partnership should create a service that has considered all aspects of the supply chain and any areas for concern so that the customer can focus on what they do rather than making sure they have the supplies they need to safely do it. To get the most out of a VMI program, be sure to work with a vendor that has experience in your industry. Your vendor should always have their finger on the pulse so when it’s time to source new or additional items, they have you covered. If you’re interested in learning how VMI can keep your business operating smoothly, our team can help.