Abstract
Despite the importance of transport within the supply chain, it has traditionally been treated as a separate functional silo within businesses. More recently, there has been increased recognition that transport needs to be integrated into the supply chain. This chapter considers the role of vendor managed inventory and demonstrates how it can be used to improve both transport and supply chain performance. With VMI control, inventory across the supplier/customer interface (including transport) is managed holistically. Scenario analysis is carried out via simulation and through a case study from the U.K. grocery sector. Among the benefits identified are control of the bullwhip effect, improved customer service, lower transport costs, and improved vehicle fill. In addition, it is found that VMI is particularly effective during times of pressure within the supply chain.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
14.6 References
Andel T (1996) Manage inventory, own information. Transportation and Distribution, May: 54–58.
Anderson EG, Fine CH, Parker GG (2000) Upstream volatility in the supply chain: The machine tool industry as a case study. Production and Operations Management 9:239–261.
Berry D, Naim MM, Towill DR (1995) Business process re-engineering an electronic products supply chain. IEE Proceedings-A 142:395–403.
Çetinkaya S, Lee CY (2000) Stock replenishment and shipment scheduling for vendor-managed inventory systems. Management Science 46:217–232.
Cheung KL, Lee HL (2002) The inventory benefit of shipment coordination and stock rebalancing in the supply chain. Management Science 48:300–306.
Christopher M, Towill DR (2002) Developing market specific supply chain strategies. International Journal of Logistics Management 13:1–14.
Cubitt B (2002) Cut the fat on freight. APICS-The Performance Advantage 12(3):42–45.
Disney SM (2001) The production and inventory control problem in vendor managed inventory supply chains. Ph.D. Thesis, University of Wales, Cardiff.
Disney SM, Holmström J, Kaipia R, Towill DR (2001) Implementation of a VMI production and distribution control system. Proceedings of the 6th International Symposium on Logistics, 187–194.
Disney SM, Towill DR (2003) Vendor managed inventory and bullwhip reduction in a two-level supply chain. International Journal of Operations and Production Management 23:625–651.
Disney SM, Potter AT, Gardner B (2003) The impact of vendor managed inventory on transport operations. Transportation Research Part E: Logistics and Transportation Review 39:363–380.
Edghill J, Olsmats C, Towill DR (1988) Industrial case-study on the dynamics and sensitivity of a close coupled production-distribution system. International Journal of Production Research 26:1681–1693.
Guba EG, Lincoln YS (1994) Competing paradigms in qualitative research. In Denzin NK and Lincoln YS (Eds.) Handbook of Qualitative Research. Sage Publications, London.
Holcomb MC, Manrodt KB (2000) The shippers’ perspective: Transportation and logistics trends and issues. Transportation Journal 40:15–25.
John S, Naim MM, Towill DR (1994) Dynamic analysis of a WIP compensated decision support system. International Journal of Manufacturing System Design 1:283–297.
Kaipia R, Holmström J, Tanskanen K (2002) VMI: What are you losing if you let your customer place orders? Production Planning and Control 13:17–25.
Kuk G (2004) Effectiveness of vendor-managed inventory in the electronics industry: Determinants and outcomes. Information and Management 41:645–654.
le Blanc HM, van Krieken MGC, Fleuren HA, Krikke HR (2004) Collector Managed Inventory: A Proactive Planning Approach to the Collection of Liquids Coming from End-of-Life Vehicles. CentER Applied Research Discussion Paper No. 2004-22, Tilburg University.
Lee HL (2000) Creating value through supply chain integration. Supply Chain Management Review, September/October:30–36.
Naim MM, Childerhouse P, Disney SM, Towill DR (2002) A supply chain diagnostic methodology: Determining the vector of change. Computers and Industrial Engineering 43:135–157.
Nieuwenhuis P (1994) Environmental implications of just-in-time supply in Japan — Lessons for Europe? Logistics Focus, April 1994: 2–4.
Nolan K (1998) With distributors in mind, Northwestern embraces VMI. Metal Center News, February:32–36.
Olsmats C, Edghill J, and Towill, D.R. (1988) Industrial dynamics model building of a close-coupled production-distribution system. Engineering Costs and Production Economics 13:295–310.
Potter A (2005) The impact of supply chain dynamics on transport. PhD Thesis, Cardiff University.
Potter A, Lalwani CS (2005) Supply chain dynamics and transport: A review. Proceedings of the 10th Logistics Research Network Conference, 353–358.
Potter A, Lalwani C, Hosoda T, Al-Kaabi H (2005) Vendor managed inventory in a grocery supply chain: What are the benefits? Proceedings of the 10th International Symposium on Logistics, 541–546.
Stank TP and Goldsby TJ (2000) A framework for transportation decision-making in an integrated supply chain. Supply Chain Management: An International Journal 5:71–77.
Towill DR (2005) A perspective on UK supermarket pressures on the supply chain. European Management Journal 23:426–438.
Waller M, Johnson ME, Davis T (1999) Vendor-managed inventory in the retail supply chain. Journal of Business Logistics 20:183–203.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2007 Springer-Verlag London Limited
About this chapter
Cite this chapter
Potter, A., Towill, D., Disney, S.M. (2007). Integrating Transport into Supply Chains: Vendor Managed Inventory (VMI). In: Jung, H., Jeong, B., Chen, F.F. (eds) Trends in Supply Chain Design and Management. Springer Series in Advanced Manufacturing. Springer, London. https://doi.org/10.1007/978-1-84628-607-0_14
Download citation
DOI: https://doi.org/10.1007/978-1-84628-607-0_14
Publisher Name: Springer, London
Print ISBN: 978-1-84628-606-3
Online ISBN: 978-1-84628-607-0
eBook Packages: EngineeringEngineering (R0)