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International Journal of Latest Research in Science and Technology

DOI:10.29111/ijlrst   ISRA Impact Factor:3.35

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A SIMULATION INVESTIGATION ON VENDOR MANAGED INVENTORY MODEL VERSUS TRADITIONAL INVENTORY SYSTEM

Research Paper Open Access

International Journal of Latest Research in Science and Technology Vol.3 Issue 1, pp 96-101,Year 2014

A SIMULATION INVESTIGATION ON VENDOR MANAGED INVENTORY MODEL VERSUS TRADITIONAL INVENTORY SYSTEM

Azadeh Noori Hoshyar, fsaneh Nouri Houshyar, Riza bin Sulaiman

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Received : 18 February 2014; Accepted : 25 February 2014 ; Published : 28 February 2014

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Abstract

There is two different points of view toward supply chain (SC) for information sharing and inventory managing which this research has focused on them. This paper investigated on two inventory policy model which called proposed Vendor Managed Inventory (VMI) and a Traditional Inventory Model (TIM). The VMI is supposed based on information sharing and maintaining the inventory on a min level. However, the policy of inventory in traditional model is considered on max inventory without any information sharing tools. The data were supposed for three members of supply chain in automotive industry for 12000 hours which is equivalent by 34 working months. It should not be forgotten to say that the proposed supply chain model is strategized by “Make to Order” policy. The models were compared with two key performance indicators (KPI’s) such as system efficiency and average inventory level. The results reveal that in the proposed VMI model in comparing with TIM, the efficiency of the system has been increased by 5% and the averages inventory level have been decreased by 37% for manufacturer (raw material inventory), 29% for manufacturer (final product inventory). The improvement on KPI’s is due to properly information sharing through Electronic Data Interchange (EDI) into VMI model.

Key Words   
Vendor Managed Inventory (VMI), Supply Chain (SC), Electronic Data Interchange (EDI), Simulation, Tr
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To cite this article

Azadeh Noori Hoshyar, fsaneh Nouri Houshyar, Riza bin Sulaiman , " A Simulation Investigation On Vendor Managed Inventory Model Versus Traditional Inventory System ", International Journal of Latest Research in Science and Technology . Vol. 3, Issue 1, pp 96-101 , 2014


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