Research On VMI Inventory Management And Its Application

Inventory management(IM) is one of the most important parts in the supply chain management (SCM), it has a great impact on both production and marketing. This paper firstly proposes a new method to solve the IM problem which could be used under the SCM environment---the Vendor Managed Inventory (VMI), and discusses the definition and causes of VMI through analyzing both of the traditional IM approach and the IM problem under the SCM environment. Additionally, two inventory control models have been introduced by this paper based on analyzing both the applying condition of the VMI mode and the problems existed in VC Company. And then, the proposed model has been implemented in practice, which points out an improvement direction for VC Company to control its inventory.The structures of the paper are followed as:1. The IM problems existed in SCM have been analyzed, and both the background of the SCM theory and its basic thinking has been introduced.2. The uncertainty and the Bull-whip Effect under SCM have been discussed in this paper, so does the shortcomings of the traditional IM method.3. This paper proposes a new IM method– the VMI under the SCM environment. The definition and causes of VMI have been pointed out based on the researches on the literatures and experience in practice4. Firstly, the VMI mode and the existed problems in VC Company have been analyzed, then propose two the two inventory control modes both based on IM control objective and integrating consignment, and then a comparison has been made between the results of the two inventory control modes. At last, the improvement direction has been pointed out.The research of this paper has some consult meanings in improving the IM levels of the domestic enterprises and enhancing their competitiveness.