Research On Operation Mode Of Integrated Third-party Logistics And Vendor-managed Inventory

In today's fierce market environment, the competition among enterprises has gradually evolved into competition between supply chains. In the supply chain, buyers occupies more and more advantages, in order to enhance their core competence, the non-core businesses are outsourced, making Vendor-managed inventory (VMI) popular in many industries. However, the vendor may not get any benefit from VMI, resulting in a lack of passion to participate; this is the major reason why VMI strategy cannot be implemented in the whole supply chain. Therefore, in order to reduce burden, vendors are seeking appropriate third-party logistics service provider for logistics outsourcing in VMI.This thesis embodies three main parts. Firstly, the deficiency of VMI and the trend of Third-party logistics (TPL) are found through a briefly literature review about VMI and TPL, then the issue discussed in this thesis is raised. Secondly, theoretical analysis of the integration of TPL&VMI is presented based on integration theory and three types of integrated mode are introduced. Then the operational mechanism of the integrated mode is analyzed and an integrated framework model is advised. Finally, we present a time-based consolidation replenishment model under the integrated mode and analyses how to fix the re-order point, replenishment quantity and consignment cycle in order to keep the lowest cost in the supply chain. Then an optimization algorithm is proposed and the sensitivity of parameters is discussed. The validity of model is verified by comparing the results to a former research. The analytical conclusion is helpful for vendors to implement VMI outsourcing.