Vendor Managed Inventory (VMI) policy has been widely used in various supply chains due to the benefits such as lower inventory levels and costs of retailer, and less frequent stock outs. In this study, the benefits of VMI policy in a manufacturer-retailer setting are analyzed under three different scenarios (Traditional Decision Making, VMI agreement and Centralized Decision Making). A manufacturer that produces a particular product is considered and that product is sold to a retailer operating under known demand forecasts. Under Traditional Decision Making System, each party is responsible for its own costs. Under VMI, manufacturer controls the replenishment decisions of the retailer and solves a Constrained Two-Echelon Lot Sizing Problem with Backordering. Under Centralized Decision Making, manufacturer and retailer act like merged, the problem under consideration is Two-Echelon Single Item Lot Sizing with Backordering. Through an extensive numerical study, three different scenarios&rsquo / results are compared and the conditions beneficial under VMI are identified. Under VMI, a Lagrangean Relaxation algorithm is proposed to reduce solution time. In terms of computational effort, solution times of proposed algorithm and MIP model are compared.

<p>For many retailers, manufacturers, and wholesalers, inventory is their single largest investments of corporate assets. Problems such as stock-outs and bullwhip effect due to sales fluctuation and poor visibility are normal for manufactures. Unnecessary activities, in the purchasing process internally and externally, such as double order handling, cost both money and time.</p><p>It is widely known that firms no longer can compete effectively in isolation of their suppliers and other entities. The future success of many businesses depends on co-operation and the co-ordination of efforts; making Supply Chain Management important. JIT and VMI are two of the philosophies that have been used to update supply chain relationships and management. By recognising your own supply weaknesses, the need for a supply strategy and a purchasing portfolio which classify suppliers emerges.</p><p>There is an interest in examining what possible benefits and drawbacks, JIT and VMI collaboration can bring and how they differ from each other. In order to have a successful collaboration and implementation, it is important to know what basis to choose suppliers on and understand what needs to be in place, internally and externally, before starting either a JIT or VMI relationship with different suppliers.</p><p>An inductive method was used in order to transform the literature review into a case study research. Explanatory and exploratory strategy was combined as well as qualitative and quantitative data collection such as oral interviews and written questionnaires. The case study was carried out at an accessory purchasing department at a large production company referred to as the “Focal company” in this thesis. Also, participating in the study were selected suppliers of the Focal company.</p><p>The literature review and the case study data was analysed which led to the results that:</p><p>• JIT and VMI can shorten lead time, improve quality and relationships if used properly, otherwise it can lead to increased inventory levels.</p><p>• Key factors for enabeling JIT and VMI are common goals, management commitment, accurate information and suitable software systems.</p><p>• Suitable suppliers for JIT and VMI are companies that have equal dependency and/or have interdependency and are willing and able to contribute to the competitive advantage of the buying firm.</p><p>• Supplier selection criteria are price, quality, delivery, flexibility, reliability organizational culture, structure and strategy.</p><p>• Implementation of JIT is not an option today at the Focal company.</p><p>• With a few IT-system updates, a little bit of education and training the Focal company and most of the suppliers in this study are ready for VMI.</p><p>• Because of the good balance of power and dependence in the relationships between the Focal company and their suppliers there is a good chance of a successful outcome.</p><p>• The Focal company’s rating criteria are well correlating with the literatures findings, which further support that they are ready to select suppliers for integrated relationships.</p>

Baigiamajame magistro darbe nagrinėjama viena iš pagrindinių tiekimo grandinių valdymo problemų ─ neapibrėžtumo efektas, didinantis įmonių veiklos sąnaudas, sandėlio lygį ir mažinantis konkurencingumą. Pagrindinis baigiamojo darbo tikslas yra pateikti galimus neapibrėžtumo efekto mažinimo būdus tiekimo grandinėse. Darbe yra analizuojama neapibrėžtumo efekto samprata, įtaka tiekimo grandinėms, identifikavimo būdai, atsiradimo priežastys ir efektą mažinančių priemonių panaudojimo efektyvumas. Išnagrinėjus teorinius ir praktinius neapibrėžtumo efekto aspektus, pateikiamos baigiamojo darbo išvados ir siūlymai. Darbą sudaro 5 dalys: įvadas, analitinė-metodinė, eksperimentinė-tiriamoji dalis, išvados ir siūlymai, literatūros sąrašas. Darbo apimtis – 62 p., 23 iliustr., 4 lent., 34 bibliografiniai šaltiniai. Atskirai pridedami darbo priedai. / The main topic of this thesis is bullwhip effect, under which influence negative factors such as increased warehouse level, demand variations, big internal expenditures and decreased competition can seriously affect efficiency of whole supply chain. The main goal of this thesis is suggest possible ways of bullwhip effect reduction in supply chain. In this is thesis author is analyzing: conceptions of bullwhip effect influence on supply chain, ways of effect identification; search for methods to decrease bullwhip effect. Main tolls of bullwhip effect reduction are: proper information sharing; reducing of shipment transportation time; using of efficient demand forecasting method; development of VMI system, and installation of up-to-date IT systems. Structure: introduction, analytical part, experiment, conclusions and suggestions, references. Thesis consist of: 62 p., 23 pictures, 4 tables, 34 bibliographical entries. Appendixes included.

The diploma thesis deals with the increasing of elasticity level in supply chain in automotive industry, especially with the import of new cars Peugeot for Czech customers. It solves discrepancy between production and consumption from point of capacity, sentimental, position and time view. It uses a method for demand forecasting by multiple temporal regression and method Vendor Managed Inventory.

O foco dessa dissertação está na gestão de estoques em sistemas multicamadas. O modelo de simulação construído considera o desempenho histórico de uma cadeia de distribuição de medicamentos versus a política de gestão proposta. Os objetivos principais do trabalho são: a avaliação quantitativa da política de cálculo de necessidades aplicada na gestão de sistemas multicamadas, a verificação da importância da cooperação entre os elos da cadeia de distribuição para gestão do fluxo de materiais e o estudo das curvas que representam o dilema ‘nível de serviço’ versus ‘custo total da cadeia’. O modelo considera o fluxo de materiais a partir do estoque em processo do laboratório até a venda para as farmácias, que pode ser aproximada pela demanda dos medicamentos visto que os estoques das farmácias são relativamente pequenos e constantes ao longo do tempo. A modelagem de custos leva em conta o custo de estoque do laboratório e dos distribuidores, o custo de pedido dos distribuidores, o custo de transporte, o custo de entrega com atraso do laboratório e o custo de venda perdida dos distribuidores. Especificamente, são considerados cenários com e sem o compartilhamento de informações entre as empresas da cadeia. Consideram-se também cenários com e sem sazonalidade na demanda. Inicialmente, cada cenário simulado é preparado com a definição do ‘período transitório da simulação’, ‘horizonte de simulação’ e ‘número de réplicas’ necessárias. Depois disso, é feito o delineamento de experimentos para identificar quais variáveis de decisão têm efeito significativo sobre o custo total da cadeia. Finalmente, é feita uma busca da parametrização de cada um dos cenários que apresente o melhor custo total da cadeia. Os resultados da simulação mostraram que as práticas atualmente empregadas na gestão dos estoques das empresas podem ter seu desempenho melhorado com a utilização da política simulada na pesquisa. Os cenários nos quais se considerou o compartilhamento de informações tiveram desempenhos semelhantes aos sem esse compartilhamento. Dessa forma, para a política simulada, conclui-se que o valor do compartilhamento de informações foi relativamente pequeno. Nas simulações pode-se verificar a melhoria simultânea do nível de serviço e do nível de estoques da cadeia. Isso mostra que a política simulada mudou o dilema (trade-off) que interliga antagonicamente essas duas características de desempenho do sistema. / This dissertation focuses on the inventory management for multi-echelon systems. The simulation model proposes a new inventory management policy and compares it to the historical performance of a medicine supply chain. The main objectives of this research are: the quantitative analysis of the method used for the calculation of material requirements in multi-echelon systems; the verification of the importance of the cooperation between the components of the supply chain to the material flow management; and the analysis of the curves which represent the trade-off between ‘service level’ and ‘total cost’. The model takes into account the material flow from the laboratory’s ‘work in process’ up to the sales to the drugstores, which can be approximated by the demand of the final consumer, since the inventory kept by drugstores is relatively small and constant in time. The costs are calculated considering: the laboratory’s and distributors’ inventory costs, the cost of orders from the distributors, the transportation cost, the laboratory’s cost of late delivery and the distributors’ cost of lost sales. Scenarios with and without the sharing of information between the components of the supply chain were both considered. The same is true for scenarios with and without seasonality in the demand. Initially, each scenario was prepared with the definition of the ‘warm-up’ period, the simulation horizon and the amount of required replications. Secondly, the design of experiments (DOE) was done in order to determine which decision variables have influence on the supply chain total cost. Finally, each scenario was tested with many different parameters in order to find the lowest cost for the supply chain. The simulation results have showed that the procedures currently applied for the inventory management can have their performance improved by the use of the policy proposed in this research. The results for the scenarios with the sharing of information were similar to the ones for the scenarios without the sharing. For that reason, we can conclude that, for the proposed inventory management policy, the value of the sharing of information through the supply chain was relatively small. In the simulations, both the ‘service level’ and the ‘total cost’ have improved. In this manner, it can be said that the new policy has improved this trade-off.

<p>Bakgrund: Historiskt har företag haft stora lager för att kunna möta kundernas efterfrågan. I takt med att kundanpassning och flexibilitet har ökat har det blivit allt dyrare och näst intill omöjligt att hålla lager som kan tillgodose kundernas behov. Att styra sitt lager så att det motsvarar efterfrågan har nästan varit en omöjlighet. En lösning på lagerstyrningsproblematiken är Vendor Managed Inventory (VMI) som innebär ett tätare samarbete mellan kund och leverantör. Kunden tillhandahåller information om lager och efterfrågan och leverantören tar över ansvaret för att varorna i kundens lager inte ska ta slut. Litteraturen kring VMI tar upp många positiva effekter som kommer att inträffa vid ett VMI-samarbete. Dock är det skralt med empiriska undersökningar beträffande effekterna av införandet av ett VMI-samarbete.</p><p> Syfte: Syftet med uppsatsen är att undersöka ett VMI-samarbete mellan en leverantör och en kund för att se om det finns empiriskt stöd för de kostnads- och leveransserviceeffekter som teorierna kring VMI tar upp. </p><p>Genomförande: Vi har undersökt samarbetet mellan Abba Seafood och ICA Handlarna. Vi intervjuade personer på båda företagen. Respondenterna hade antingen ett övergripande ansvar för VMI-samarbetet eller kom i kontakt med VMI i det dagliga arbetet. </p><p>Resultat: Efter att ha analyserat samarbetet mellan Abba och ICA så kan vi konstatera att många av de positiva effekter som kan förväntas av ett VMI- koncept har infriats och några inte. Vad vi inte kan fastställa i alla lägen, är om det är just VMI som är bakgrunden till förbättringarna, eller om det helt enkelt är den förbättrade informationsspridningen. En stor fråga har varit om det verkligen är nödvändigt för leverantören att ta över styrningen av kundens lager för att förbättringarna ska vara tydliga.</p>

Bakgrund: Historiskt har företag haft stora lager för att kunna möta kundernas efterfrågan. I takt med att kundanpassning och flexibilitet har ökat har det blivit allt dyrare och näst intill omöjligt att hålla lager som kan tillgodose kundernas behov. Att styra sitt lager så att det motsvarar efterfrågan har nästan varit en omöjlighet. En lösning på lagerstyrningsproblematiken är Vendor Managed Inventory (VMI) som innebär ett tätare samarbete mellan kund och leverantör. Kunden tillhandahåller information om lager och efterfrågan och leverantören tar över ansvaret för att varorna i kundens lager inte ska ta slut. Litteraturen kring VMI tar upp många positiva effekter som kommer att inträffa vid ett VMI-samarbete. Dock är det skralt med empiriska undersökningar beträffande effekterna av införandet av ett VMI-samarbete. Syfte: Syftet med uppsatsen är att undersöka ett VMI-samarbete mellan en leverantör och en kund för att se om det finns empiriskt stöd för de kostnads- och leveransserviceeffekter som teorierna kring VMI tar upp. Genomförande: Vi har undersökt samarbetet mellan Abba Seafood och ICA Handlarna. Vi intervjuade personer på båda företagen. Respondenterna hade antingen ett övergripande ansvar för VMI-samarbetet eller kom i kontakt med VMI i det dagliga arbetet. Resultat: Efter att ha analyserat samarbetet mellan Abba och ICA så kan vi konstatera att många av de positiva effekter som kan förväntas av ett VMI- koncept har infriats och några inte. Vad vi inte kan fastställa i alla lägen, är om det är just VMI som är bakgrunden till förbättringarna, eller om det helt enkelt är den förbättrade informationsspridningen. En stor fråga har varit om det verkligen är nödvändigt för leverantören att ta över styrningen av kundens lager för att förbättringarna ska vara tydliga.

Introduction: Nowadays beverage companies must focus on maintaining healthy finishedgoods inventory stocks in order to be able to decrease inventory costs, meet customerrequirements and to obtain competitive advantage. However many beverage SMEdon’t have an accurate planning and forecasting to manufacturing inventories. Thereforethey often face the problem of optimization in inventory management due to several differentreasons. As a result, company loses its competitiveness. Thus, there is a need tocoordinate Inventory activities of beverage SMEs to improve inventories’ planning. The purpose of this study is to analyze how inventory management is organized in a small Chinese beverage company. Frame of reference: This research is based on the theoretical framework relates with InventoryManagement (IM) and Retailer-managed inventory (RMI), vendor-managed inventory(VMI) and Collaborative Planning, Forecasting and Replenishment (CPFR).Empirical Data were collected through personal interviews and organization documents. Methodology: The research strategy for this paper is a single case study. This strategy allows investigating topic in its real life context. The inductive approach is used for this research based on qualitative data. The major source of data collection was semi-structured interviews and the company's documents. For analyzing data categorization approach was applied. Conclusion: The study found that inventory management theories presented in scientificliteratures are used in practice. To achieve better inventory management for beverageSMEs, the authors summarize four importance parameters based on literatures and findings.The authors also provide some suggestions based on the importance parameters inthe conclusion to optimize the case company’s inventory management.

Le développement des technologies de l’information et de la communication que connait notre siècle a grandement facilité les pratiques d’échanges d’informations au sein des chaînes logistiques. Ces pratiques ont pu ainsi évoluer vers de nouvelles formes de collaborations entre entreprises, telles que le Partage d’Informations (PI) et le Vendor Managed Inventory (VMI). Le VMI est un mécanisme de coordination dans lequel le fournisseur a la responsabilité de la gestion des stocks de son client. Ce mécanisme repose sur plusieurs principes parmi lesquels un partage d’informations très développé entre les parties qui s’y engagent. Le PI et le VMI sont adoptés par les entreprises pour permettre une augmentation des profits et une réduction des coûts. Toutefois, leurs résultats sont mitigés et nécessitent encore un approfondissement de leur compréhension. La contribution de cette thèse se situe dans l’analyse des impacts de ces mécanismes sur des chaînes logistiques où tous les maillons sont des entreprises de production dont les efficacités peuvent être différentes. Pour ce faire, plusieurs scénarios ont été étudiés sur des chaînes logistiques constituées de trois échelons, chaque échelon peut appartenir à quatre classes d’efficacité. Ces chaînes peuvent répondre à deux types de demande du marché final ; une demande stable ou une demande variable. De plus, plusieurs mécanismes de coordination sont étudiés : les mécanismes de gestion standard, de partage d’informations entre deux échelons, de partage d’informations entre trois échelons, de VMI entre deux échelons, puis de VMI étendu aux trois échelons. L’outil utilisé pour mener ces expérimentations est le logiciel de simulation à évènements discrets Arena. L’interprétation des résultats a montré que le mécanisme de coordination avec partage d’informations n’a pas eu d’amélioration très significative sur les résultats. En effet, puisque les entreprises ont des capacités de production finies, la disponibilité de l’information n’a pas permis d’obtenir des résultats différents. Le VMI, de son côté, a pu réaliser des réductions des stocks et des coûts de la chaîne logistique. Ces réductions ont été plus importantes chez les chaînes logistiques dont les maillons sont de faibles efficacités. Chez ces dernières, ce sont les deux parties concernées par le VMI (le fournisseur et le donneur d’ordres) qui ont tiré des avantages du VMI. Chez les chaînes logistiques constituées de maillons de haute efficacité, le VMI a permis une réduction des coûts moins importante, car ces chaînes logistiques sont déjà de performance élevée. Pour celles ci, c’est le client qui a tiré profit du VMI, alors que le fournisseur VMI a subi une augmentation des coûts suite à l’augmentation de la fréquence de transport qu’a impliqué ce mécanisme. / The advent of new information and communication technology has greatly facilitated the information exchange practices within supply chains. These practices recently evolved into new forms of collaborations between companies such as Information Sharing (IS) and Vendor Managed Inventory (VMI). The VMI is a coordination mechanism where the supplier is responsible for the inventory management of his customer. This mechanism is based on several principles, including developed information sharing between involved parties. The use of IS and VMI allow companies to increase profits and reduce costs. However, the results about the benefits from their use remain not clear. This motivates the need for new assessments and a better understanding of their effects. This thesis main contribution lies in the analysis and comprehension of IS and VMI’s impacts on supply chains. Especially, we address the issue of supply chains where tiers are production companies with different effectiveness levels. The examined scenario is based on a three tiers supply chain where each tier can belong to four effectiveness classes. The supply chain can respond to two types of end market demands: stable demands or fluctuant demands. In addition, several coordination mechanisms are studied: (i) standard management mechanism, (ii) information sharing between two enterprises, (iii) information sharing between three enterprises, (iv) VMI and (v) Extended VMI to all the three enterprises. The tool used to conduct these experiments is the discrete event simulation software “Arena”. The interpretation of the results showed that the IS coordination mechanism has not very significant improvement. Indeed, as companies have finite capacity, the availability of information did not yield better results. Whereas, the VMI could achieve reductions in both inventory and supply chain costs. In addition, VMI improved profits of the two parties, the vendor and the customer. Finally, the advantages of VMI appear to be stronger when the overall supply chain is less effective.

O foco dessa dissertação está na gestão de estoques em sistemas multicamadas. O modelo de simulação construído considera o desempenho histórico de uma cadeia de distribuição de medicamentos versus a política de gestão proposta. Os objetivos principais do trabalho são: a avaliação quantitativa da política de cálculo de necessidades aplicada na gestão de sistemas multicamadas, a verificação da importância da cooperação entre os elos da cadeia de distribuição para gestão do fluxo de materiais e o estudo das curvas que representam o dilema ‘nível de serviço’ versus ‘custo total da cadeia’. O modelo considera o fluxo de materiais a partir do estoque em processo do laboratório até a venda para as farmácias, que pode ser aproximada pela demanda dos medicamentos visto que os estoques das farmácias são relativamente pequenos e constantes ao longo do tempo. A modelagem de custos leva em conta o custo de estoque do laboratório e dos distribuidores, o custo de pedido dos distribuidores, o custo de transporte, o custo de entrega com atraso do laboratório e o custo de venda perdida dos distribuidores. Especificamente, são considerados cenários com e sem o compartilhamento de informações entre as empresas da cadeia. Consideram-se também cenários com e sem sazonalidade na demanda. Inicialmente, cada cenário simulado é preparado com a definição do ‘período transitório da simulação’, ‘horizonte de simulação’ e ‘número de réplicas’ necessárias. Depois disso, é feito o delineamento de experimentos para identificar quais variáveis de decisão têm efeito significativo sobre o custo total da cadeia. Finalmente, é feita uma busca da parametrização de cada um dos cenários que apresente o melhor custo total da cadeia. Os resultados da simulação mostraram que as práticas atualmente empregadas na gestão dos estoques das empresas podem ter seu desempenho melhorado com a utilização da política simulada na pesquisa. Os cenários nos quais se considerou o compartilhamento de informações tiveram desempenhos semelhantes aos sem esse compartilhamento. Dessa forma, para a política simulada, conclui-se que o valor do compartilhamento de informações foi relativamente pequeno. Nas simulações pode-se verificar a melhoria simultânea do nível de serviço e do nível de estoques da cadeia. Isso mostra que a política simulada mudou o dilema (trade-off) que interliga antagonicamente essas duas características de desempenho do sistema. / This dissertation focuses on the inventory management for multi-echelon systems. The simulation model proposes a new inventory management policy and compares it to the historical performance of a medicine supply chain. The main objectives of this research are: the quantitative analysis of the method used for the calculation of material requirements in multi-echelon systems; the verification of the importance of the cooperation between the components of the supply chain to the material flow management; and the analysis of the curves which represent the trade-off between ‘service level’ and ‘total cost’. The model takes into account the material flow from the laboratory’s ‘work in process’ up to the sales to the drugstores, which can be approximated by the demand of the final consumer, since the inventory kept by drugstores is relatively small and constant in time. The costs are calculated considering: the laboratory’s and distributors’ inventory costs, the cost of orders from the distributors, the transportation cost, the laboratory’s cost of late delivery and the distributors’ cost of lost sales. Scenarios with and without the sharing of information between the components of the supply chain were both considered. The same is true for scenarios with and without seasonality in the demand. Initially, each scenario was prepared with the definition of the ‘warm-up’ period, the simulation horizon and the amount of required replications. Secondly, the design of experiments (DOE) was done in order to determine which decision variables have influence on the supply chain total cost. Finally, each scenario was tested with many different parameters in order to find the lowest cost for the supply chain. The simulation results have showed that the procedures currently applied for the inventory management can have their performance improved by the use of the policy proposed in this research. The results for the scenarios with the sharing of information were similar to the ones for the scenarios without the sharing. For that reason, we can conclude that, for the proposed inventory management policy, the value of the sharing of information through the supply chain was relatively small. In the simulations, both the ‘service level’ and the ‘total cost’ have improved. In this manner, it can be said that the new policy has improved this trade-off.