Which of the following supplier actions is most likely to provide an incentive for retailers to share demand data with their trading partners?
Which of the following supplier actions is most likely to provide an incentive for retailers to share demand data with their trading partners?
Implementing vendor-managed inventory (VMI) at the retailers is the supplier action most likely to provide an incentive for retailers to share demand data with their trading partners. In a VMI arrangement, the supplier takes responsibility for managing the inventory levels at the retailer's location, which necessitates the sharing of accurate demand data by the retailer to ensure optimal inventory management. This collaboration benefits both parties, as the retailer reduces the risk of stockouts and excess inventory, while the supplier can plan production and replenishment more effectively.
A. Implementing vendor-managed inventory (VMI) at the retailers is the supplier action that is most likely to provide an incentive for retailers to share demand data with their trading partners. With VMI, the supplier takes responsibility for managing the inventory levels at the retailer's location based on the demand data shared by the retailer. By doing so, the supplier can ensure that the retailer does not run out of stock while reducing excess inventory and the risk of stockouts. This approach also incentivizes the retailer to share accurate demand data to ensure that the supplier can effectively manage inventory levels.
In a VMI arrangement, the supplier is responsible for maintaining the inventory levels at the retailer's store or warehouse.