Vendor Managed Inventory (VMI) is widely used in western manufacturing. This paper analyzes VMI implementation in American manufacturing and finds out that several requirements must be considered before implementing the VMI. These factors are Excessive technical investment, weak trust, opaquely shared information and lower forecasting capability. After analyzing current situation of domestic manufacturing, this paper arrives at the conclusion that domestic manufacturing is not suitable for implementing VMI at present. Other inventory management measures should be adopted by domestic manufacturing to lower the inventory cost and improve the competence.
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