Vendor Managed Inventory (VMI)

Tags: Glossary

A supply chain management strategy where vendors manage the inventory of their customers.

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What is Vendor Managed Inventory (VMI)?

Vendor Managed Inventory (VMI) is a supply chain management technique in which the supplier of goods manages the inventory levels and replenishment schedules for the buyer. This approach can improve supply chain efficiency by reducing inventory levels, optimizing order quantities, and improving forecasting accuracy. 

VMI typically requires close collaboration and communication between the buyer and the supplier and may involve the use of specialized software or systems to manage inventory and replenishment processes. 

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