Vendor Managed Inventory - Coming to A Store Near You

Source from:  Tobacco Reporter 01/21/2011

Hauni is hoping to expand the take-up of its recently launched Vendor Managed Inventory (VMI) system that is said to minimize tobacco manufacturers' purchase costs and streamline their order processing, thereby freeing their people for more important jobs. VMI is said also to provide a far greater degree of dependability within the manufacturing process because the OEM (original equipment manufacturer) works with the tobacco manufacturer to optimise inventory-controlled materials procurement. "Many Hauni customers already view the Hauni Webshop and the EDI [electronic data interchange] link as important elements in their purchasing routine," Hauni said in a press note. "Now, Hauni has a professional VMI solution to offer which not only makes the logistics of ordering spare parts even simpler for the customer but actually benefits buyer and seller alike." "Our new VMI service goes a step further by fully automating the replenishment process for fast moving parts," said service operations manager, Heiko Geißler. "That means we not only supply the spares but also actively manage the customer's inventory including the parts ordering process, and we also suggest ways to improve materials planning parameters. "It all makes spares easier for clients to procure whilst benefiting them financially." VMI is controlled via a secure system which communicates daily with the customer to transfer warehouse data. If stocks of a particular part are found to have reached the defined minimum, the program will automatically initiate a replenishment process. "The steps involved at both ends in processing an order can actually be automated as far as 100 per cent," the press note said. "Additional parameters can be defined to optimise shipping costs." "The entire process is designed for maximum transparency both to the customer and to Hauni." "Inventory parameters can be modified to ensure the optimum level of tied capital at any given time, allowing factories to respond swiftly to any change in the manufacturing situation." "Customers stand to benefit in a variety of ways," said Geißler. "Minimising stocks also releases tied capital. By discussing and repeatedly reviewing the inventory parameters, warehouse stocks can be reduced to the necessary minimum whilst taking precautions to avoid stock-out situations. "We see to it that required parts are always available, therefore allowing the customer to rest assured that they are safeguarded from production downtimes caused by spare part shortages." The press release said that, at the customer's end, staff resources could be better utilised because most of the stock auditing work was taken off their hands. "Running out of parts is not the only risk," said Geißler. "Sometimes a factory can lose track of stocked items which lie on warehouse shelves till they no longer fit on current machine models and end up having to be scrapped. Those are expenses which can be avoided." Hauni said that now customers in various parts of the world had expressed "great satisfaction" with this service, it hoped to be able to provide it to many others, raising customer satisfaction levels still further in the field of e-commerce. "Consumer goods companies have been using a similar principle for some time, and today there is hardly a supermarket chain where shelves are not automatically refilled by the supplier," the press note said. Enditem