DATA-DRIVEN
VENDOR-MANAGED
INVENTORY
SYSTEMS

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Data-Driven VMI

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Vendor-managed inventory (VMI) programs are about reduction. VMI helps you reduce:

  • COSTS
  • PROCUREMENT TIME
  • INVENTORY
  • AGGRAVATION
  • OVERHEAD


VMI is also about increasing turns, availability, and efficiency.

Here’s how Field Fastener does VMI: through real-time communication between your inventory and our global supply base, we act as an extension of your team, ensuring you have the right parts at the right time — and at the most competitive price on the market.

WHAT IS VMI?

Vendor-managed inventory (VMI) is a practice in which a supplier takes full responsibility for managing a buyer’s inventory at that buyer’s location. With the right tools, it is easier for a supplier to effectively manage inventory than for buyers to try and manage hundreds or thousands of part numbers on their own. Implementing a VMI system means the right product is always available.

WHY IMPLEMENT A VMI SYSTEM?


Improved inventory management.

Lowering inventory levels can amount to significant savings. The best VMI systems use data to monitor usage and ensure proper inventory levels, maximize availability, and minimize costs.

Reduced administrative time and costs.

Procurement personnel spend less time managing the class ‘C’ commodities so they can spend more time on class ‘A’ or ‘B’ items and commodities that have a greater overall impact.

Stronger supplier relationship.

Since VMI systems are actively managed, the supplier can spend time collaborating with the buyer on cost reduction projects and other proactive initiatives. This open communication between suppliers and buyers leads to long-lasting, positive relationships that are focused on quality.

TYPES OF VMI SYSTEMS



Bin Stocking

Using a barcode scanner, a Field rep visually audits stock quantities and creates a personalized order for items below the minimum quantity. Your Field technician will make inventory decisions on-site and utilize technology to ensure product availability, focusing on continuous improvement of the system.

Point of Use

This system is for manufacturers who prefer to maintain inventory as close to the point at which it’s used as possible. This promotes greater efficiency, as inventory is readily at an assembly station when it’s needed. It is important to properly size the bins to minimize the cost of replenishing bins too frequently.

EDI

Electronic data interchange (EDI) is a ‘system to system’ method of managing inventory in which all actions are carried out automatically, not requiring employees to be directly involved. Strict parameters are entered into the customer system, which then syncs with the supplier’s information and provides a flawless method of replenishment without involving hours of labor.

Camera

A stocking location is set up within view of an installed camera. The supplier monitors the stock remotely and orders parts or adjusts stocking levels as necessary.


In-Plant Store

An in-plant store system is ideal when part volume warrants replenishment several times per week. For customers who want active, daily, on-site inventory management and on-site vendor warehousing, we maintain inventory and staff within your manufacturing site. In many cases, your Field rep will also serve as your account manager, managing the inventory in the supply chain as well.

Kanban

This system supplies components, parts, and supplies to specific locations based on a pull signal. Kanbans are visual cues that authorize the replenishment of inventory at a specified location in a pull environment. Whenever a piece of Kanban inventory is consumed, a replenishment action is triggered.

Consignment

With this method, the supplier holds inventory at your location and retains ownership of the inventory until it’s moved out of consignment, which triggers payment. This is useful for situations in which the desired inventory turns cannot be realized using other methods.

Custom

If none of these approaches to VMI meets your objectives, we will develop an approach that does. The best VMI suppliers do not believe in a uniform system for each customer. Processes are different across different industries, and what works for a customer at one plant may not be the right fit at another location. The best systems are the ones that are tailored to meet the customer’s needs. When designing a new VMI system, we consider the number of parts in the system, inventory, quality requirements, material handling, and storage, ensuring that our customers have a system in place that is right for them.

CHARACTERISTICS OF A GREAT VMI SYSTEM


The best VMI systems are ones that:

  • Use data to analyze consumption patterns and adjust inventory levels
  • Minimize transaction processing costs while improving information accuracy
  • Include agreed-upon performance metrics and a reporting system to regularly review performance
  • Encourage ongoing cost reduction efforts by incentivizing each party to actively identify and implement cost reduction suggestions
  • Provide proper checks and balances to ensure proper accounting controls but relies on a relationship based on trust to minimize auditing costs
  • Is tailored to the individual needs of the customer
  • Includes a plan for seamless transition to VMI to ensure the customer is set up for success from the start

Types of Parts that Work Well with a VMI System


Is VMI the right fit for the parts you’re currently sourcing and stocking? Here’s how to tell.


GOOD CANDIDATES FOR VMI

  • Medium to high-volume parts that require significant ordering, order management, and procurement time
  • Parts with frequent shortages
  • Parts that can be certified for “dock to stock,” minimizing or eliminating incoming inspection


NOT IDEAL FOR VMI

  • Very sporadic usage, e.g., months with no usage and then 50% of the annual usage over a short period of time
  • Consistent quality issues. These issues need to be corrected before starting VMI

Next-Level VMI: The ROI+ App


ROI+ provides you with bottom-line results through Replenishment, Optimization, Innovation, + our Field team.

Using our proprietary ROI+ app, available only from Field, to gather and communicate data, we create a production floor environment of operational excellence through the use of part analytics, logistics, and asset management to provide precise product availability at the point of consumption — yielding you the highest ROI possible.

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Use the ROI+ Kiosk and Mobile App to


REPLENISH

Locate parts within your facility, request more parts, and inquire about the status of open orders.

OPTIMIZE

Communicate directly with Field experts, who can provide assistance or help solve design challenges.

INNOVATE

Analyze your productivity to uncover additional efficiencies or cost savings.

+ Field Team

In addition to making parts replenishment seamless, we help you gain insights from your data, with the ultimate goal of reducing your total cost of fastening.

Get Started with Field’s Data-Driven VMI Approach


Field’s data-driven approach to VMI dramatically reduces costs, inventory, and overhead for your business while increasing turns and availability and improving manufacturing process efficiencies.

Our global reach means we can provide product and VMI services anywhere you need them in the world. We’ll efficiently and cost-effectively manage your requirements while customizing a program to fit your specific needs.

The proactive, engineering-based management of our VMI program means you’ll always have appropriate stocking levels based on your business conditions and needs. Data-driven above all else, we’ll perform a root cause analysis on any shortage that occurs and provide you with data that can help your organization accurately forecast.

Moreover, our proactive continuous improvement process means we always look to improve the program before failures occur, reducing your downtime. From prep to just-in-time restocking, Field is more than just parts. We’re your partner, with the systems, passion, people, experience, and inventory to support your changing needs.

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