Vendor Managed inventory, from concept to processes,

for an unified view

Guillaume Marques, Jacques Lamothe, Caroline Thierry, Didier Gourc

To cite this version:

Guillaume Marques, Jacques Lamothe, Caroline Thierry, Didier Gourc. Vendor Managed in-
ventory, from concept to processes, for an unified view. B. MONTREUIL & J. RAPPOLD.
ILS 2008 - 2nd International Conference on Information Systems, Logistics, and Supply chain,
May 2008, United States. University of Wisconsin, p.536-546, 2008. <hal-00444174>

HAL Id: hal-00444174

https://hal.archives-ouvertes.fr/hal-00444174
Submitted on 6 Jan 2010

HAL is a multi-disciplinary open access Larchive ouverte pluridisciplinaire HAL, est

archive for the deposit and dissemination of sci- destinee au depot et a la diffusion de documents
entific research documents, whether they are pub- scientifiques de niveau recherche, publies ou non,
lished or not. The documents may come from emanant des etablissements denseignement et de
teaching and research institutions in France or recherche francais ou etrangers, des laboratoires
abroad, or from public or private research centers. publics ou prives.
 International Conference on Information Systems, Logistics and Supply Chain,
Madison, United-States, May 2008

VENDOR MANAGED INVENTORY, FROM CONCEPT TO

PROCESSES, FOR AN UNIFIED VIEW

Guillaume MARQUES^, Jacques LAMOTHE^, Caroline THIERRY*, Didier GOURC^,

* Universit de Toulouse, 5 alles Antonio Machado, 31058 Toulouse France,

thierry@univ-tlse2.fr
^ Universit de Toulouse, Ecole des Mines dAlbi-Carmaux, Centre Gnie Industriel, Campus
Jarlard, route de Teillet, 81013 Albi CT Cedex 09 - France,
didier.gourc@enstimac.fr - lamothe@enstimac.fr - marques@enstimac.fr

IRIT Universit Paul Sabatier, 118 route de Narbonne, F-31062 Toulouse Cedex 9

Abstract: In a supplier-customer relationship, Vendor Managed Inventory (VMI) is currently used to

monitor the customers inventory replenishment. However the integration of VMI implies consequences
on the collaboration process that links the different planning processes of each partner. This paper
proposes a unified view of the VMI: beyond the short term pull system inventory replenishment, partners
have to share their vision of the demand, their requirements and their constraints to fix middle/long term
common objectives for each article concerned by VMI. There are many ways to specify these links
between VMI and partners planning processes.
Keywords: Vendor Managed Inventory, Supply chain management, Collaboration, Simulation

1 Introduction
Using supply chain collaboration more strategically has become crucial in todays increasingly
demanding business process to create new revenue opportunities, efficiencies and customer loyalty
(Ireland and Crum 2005).
Lack of demand visibility has been identified as an important challenge for the supply chain
management resulting in inefficient capacity utilization, poor product availability and high stock levels
for each partner (Smaros et al., 2003). According to this, increasing the demand visibility on production
and inventory control was a first step to improve this collaboration between members of the supply chain.
In this view, Quick Response (QR) was born in the beginning of the 80s in order to reduce delay needed
to serve the customer in the textile industry. The supplier receives a point of sale data from the customer
and uses this information to synchronize its production. In the beginning of the 90s the Continuous
Replenishment Policy (CRP) was developed: based on consumer demand, the CRP pull system replaces
the historical push systems. Gradually, the sphere of decision of the suppliers is growing until the VMI
transfers the totality of the customers inventory replenishment responsibility to the supplier (Tyan and
Wee, 2002).
To describe the supply chain management, Brindley and Ritchie (2004) emphasize the difference
between the notions of logistics, as the physical and tangible activities, and the relationship building and
management as the behavioral and intangible dimension. Therefore, beyond the tangible short term
replenishment dimension of the VMI, what does implement VMI mean in terms of relationship and tactic
or strategic exchanges?
Furthermore, it clearly appears that the implementation of the process is limited to particular
situations. For example, today VMI is quasi-exclusively synonymous with distribution context. So the
way to extend Distribution-VMI notions to the relationship between industrial partners must be focused
on.

1
 The purpose of this paper is first to clarify the VMI concepts (what clearly is VMI and how can
VMI be concretely implemented in the supply chain) and secondly to deal with the integration of VMI
inside the industrial actors planning processes. Thus, the first part presents a state of art of the VMI,
which enables to propose a global VMI process in a second part. In a third part we propose an integration
of the VMI processes inside actors planning processes. In a last part, we will present conclusion and
future researches.

2 Literature review
2.1 Literature overview
As Disney and Towill (2002) argue, moving to a VMI scenario alters the fundamental structure of
the supply chain ordering. But details of this transformation are not clear. In order to measure the impact
of different Information and Communication Technologies on supply chain dynamics, Disney et al.
(2002) have implemented VMI (and other scenarios) in the Beer Game. The debriefing of the game
clearly underlines the players difficulty to implement the VMI concept and they need for clarification.
In the literature, three main types of contribution can be found: general, case studies and models.
General papers give a general definition of the VMI and the main benefits of its application. Industrial
case studies delimit the scope of the VMI application, its benefits and limits. Finally, modeling papers
propose mathematical models that underline key parameters, called determinants, that impact the VMI
performance.
We first analyzed how the term VMI is qualified in the literature. We are interested in the
introductive and descriptive parts of the different papers. It can be noticed that authors use more than four
different words or expressions to qualify VMI in a same article. We found twenty-four expressions used
to qualify VMI (Table 1 in appendix A) that can be organized around five families:
- Concept: these are expressions used in a very large and generic sense.
- Process: these expressions show a functional, a process oriented approach of VMI.
- Cooperation: these expressions emphasize the relationship between partners.
- Cooperative process: this family inherits process and cooperation families.
- Technology: a focus on technologies that support VMI.
After building these families, Appendix A quantifies the use of each expression. For a given
article, figures in percentage associated to a particular expression represent the frequency of apparition of
this expression in proportion to the totality of the expressions used in this article.
Globally, all authors introduce the VMI with general terms, which belong to the concept family.
The process terms are used in a majority of papers, but are less developed. The cooperation and
technology sides are treated in case studies. Modeling papers broach the cooperative process, but each
author develops a particular way to build the cooperative process.
To conclude, the overview of the literature underlines that a general consensus exists around the
concept and the main expectations associated to the VMI. However, authors make their own interpretation
of the integration of the cooperative process.

2.2 Objectives of VMI

Expressions extracted to concept and process families give all the necessary elements to identify
the objectives of VMI. According to Tang (2006), the customers target is to insure higher consumer
service level with lower inventory costs. Suppliers is to reduce production, inventory and transportation
costs. However, we can identify common objectives, which permit to build up a better collaboration
between the partners and so to reach the main objectives: tensing the different flows, speeding up the
supply chain (Holveg et al. 2005) and reducing the bullwhip effect (Disney and Towill 2003, Holveg et
al. 2005, Achabal et al. 2000, Cetinkaya and Lee 2000).

2
2.3 Determinants of VMI
Many authors focus their analysis on one or on a limited number of the links between one objective
and the associated determinants. VMI implementation is mostly translated into a backing up of stocks
from the customer to the supplier warehouse (Blatherwick 1998). The supplier has to maintain the
customers inventory level within certain pre-specified limits (Tang 2006) based on a minimum and
maximum range (ODETTE 2004).
Moreover most authors agree to explain the interest of transfer of customers inventory
responsibility from customer to supplier (Dong et al. 2007, Holveg et al. 2005, Kaipia and Tanskanen
2003, Tang 2006, Kuk 2004). With VMI, the customer delegates the ordering and replenishment planning
decisions to the supplier (Tang, 2006).
The supplier bases replenishment decisions on the same information than the one the customer
previously used to make its purchase decisions (Holveg et al. 2005). So, when VMI is implemented, the
supplier has a better vision of the customers demand (Kaipia and Tanskanen 2003). It results in more
accurate sales forecasting methods and more effective distribution of inventory in the supply chain
(Achabal et al. 2000). Production, logistics and transportation costs can be reduced due to coordinated
production and replenishment plans for all customers (Tang 2006). Thanks to a better visibility, the
supplier is able to smooth the peaks and the valleys in the flow of goods (Kaipia and Tanskanen 2003). In
other terms, it reduces the bullwhip effect. Disney and Towill (2003) have demonstrated that VMI can
reduce this effect by 50 % mainly thanks to the visibility of the demand through the in transit and
customers inventory levels. Yao and Dresner (2007) show that information sharing reduces the supplier
safety stock, thereby reducing the average inventory level.
Furthermore, implementing VMI leads the supplier to higher replenishment frequency with smaller
replenishment quantity (Yao et al. 2007, Dong et al. 2007) and so to greater inventory cost saving
(Cetinkaya and Lee 2000). The supplier obtains a new degree of freedom, making decisions on quantity
and timing of replenishment (Rusdiansyah and Tsao 2005). The delivery frequency appears like a
performance lever for the supplier. The effects of transportation disruption impact are less severe when
VMI is used (Wilson 2007).
Figure 1 summarizes the different objectives of the VMI differentiating individual and
collaborative (supply chain) objectives. The link between one determinant and the objective, which
appears just on top, is not exclusive. Each objective inherits all the determinants below.

Figure 1: Objectives and associated determinants of the VMI

3
2.4 Scope of application
VMI has been widely adopted by many industries for years. The classical success story for VMI
implementation is the partnership between Wal-Mart and Procter & Gamble. Some studies show the
difficulties to implement VMI successfully (Tyan and Wee 2002).
Tyan and Wee (2002) particularly study the adoption of VMI by the Taiwanese grocery industry.
This adoption is slow in comparison with western countries. According to the authors, the confidentiality
of information sharing, the risk of loss of control by the customer or the increase of suppliers
administrative costs cause the failure of more than one out of two attempts of implementation. The
reasons are attributed to business culture, complicated logistics flows and complex distribution channels.
First, the Taiwanese grocery industry represents a protective environment with minimal competition from
foreign companies. In that sense, they agree with Dong et al. (2007) who underline the weight of the
market competitiveness in VMI adoption. Secondly, the supply chain is complex (characterized by a large
number of actors and intermediaries for a multi channel retail market).
De Toni and Zamolo (2005) present key characteristics of VMI as short replenishment lead times
and frequent and punctual deliveries that optimize production and transport planning. Furthermore,
according to them, the middle/long term collaboration allows to proportion suppliers production capacity
and to determinate the minimum and maximum customers inventory level. Holveg et al. (2005) explain
that if a supplier does not integrate several information at a tactical planning level, the impact of VMI is
negative. For example, the Bullwhip effect, which theoretically considerably decreases, increases. Dong
et al. (2007) conclude that existing collaborations between the two actors would certainly facilitate the
adoption of the VMI. ODETTE (2004), which presents VMI as a concept and process, defines the
specifications of an Information System to support VMI processes.
The study of literature shows that almost all authors quasi-exclusively apply VMI to the
Distributor-Supplier relationship. De Toni and Zamolo (2004) present a case study about VMI
implementation. They explain that this implementation started with the distributor, but that it could be
successfully developed to the other echelons of the supply chain. Gentine (2002) gives general
perspectives about this VMI application to an industrial-industrial relationship. In particular, he cites the
reduction of levels of stocks and the possibility to reduce transport cost thanks to the new degrees of
freedom given to the supplier.

3 Our vision of the VMI process

From the literature review, it is possible to have a global idea about what VMI is, but a number of
questions remain when we seek to implement it. We define the VMI concept as followed:
- a replenishment pull system.
- Where the supplier is responsible for the customers inventory replenishment.
- Inside a collaborative pre-established middle/long term scope.
We can characterize the transition from the classic push supplier-customer relationship to a pull
relationship thanks to two main transformations:
- there is no longer a purchase order from middle term processes of the customer,
but a short term information about the consumption of the inventory.
- The Material Requirement Planning (MRP) of the supplier no longer releases a
work order, but only a target level for the suppliers inventory.
However, VMI represents more than this pull version of the classical supplier-customer
relationship. According to the concept, it may lead to a collaboration situation between the partners. VMI
has to introduce information sharing and common decision-making processes. The integration of the VMI
in the planning and scheduling process of partners results in a new collaboration protocol. We define
three levels in this protocol. The Partnering Agreement, specifies the integration of the planning
processes of the partners into a VMI replenishment planning process. The Logistical Agreement fixes
the parameters, which regulate the management of each article (minimum maximum inventory level,

4
minimum delivery quantity, transport schedule) (Grning and Holma, 2007). The Production and
Dispatch process monitors pull short-term decisions as production dispatch and transport.
The following Figure 2 represents the links between the three main processes of the VMI. We find
the different levels of decision. First, the PA synchronizes VMI with the partners planning processes. It
specifies the constraints to the Logistical Agreement and Production and Dispatch processes when
integrating its into a global collaboration protocol.
Secondly, inside a fixed collaboration protocol, the LA allows to confront constraints and
requirements of each actor. The objective is to converge on logistical parameters, which define and
constraint the short term decisions in the Production and Dispatch process. Figure 2 distinguishes two
short term implementations depending on whether Production and Dispatch decisions are integrated or
not:
- Dispatch-VMI: most papers consider that the degree of freedom is only used for the
dispatching decision. Therefore, the suppliers finished product inventory is
replenished according to classical push or pull production approaches. Here,
delivery possibilities are limited by the inventory level of product that the
production has fixed.
- Integrated-VMI: some papers consider that the degree of freedom also directly
impacts the suppliers production, and its work in progress. In this case, we
consider that dispatch and production decisions are taken simultaneously. The
target is to optimize the entire process. Some optimization methods could be used
to reach a global optimum.

Integrated-VMI Dispatch-VMI
Figure 2: VMI macro-processes
Beyond this distinction in the short term processes, a global reflection about the integration of these
VMI processes with the actors planning processes is necessary.

4 Integration of MRPII and VMI processes

In this part, we propose an integration of the VMI processes with the usual internal planning
processes of the supply chain actors.

4.1 MRPII processes

In this study we refer to the Manufacturing Resource Planning (MRPII) to illustrate the
implementation of the VMI into the actors planning processes.
The Sales and Operations Planning (SOP) Process: details the various decisions, which are taken
throughout the long term planning. Its most important outputs are the production capacities (production
5
SOP) and long term forecast of supplying requirement (supply SOP) (see Figure 3). This model includes
the forecast calculation, the interpretation behaviours the decision-maker exhibits when examining the
forecasts received from his customers, the transmission behaviours when a decision-maker sends his
forecasts to his supplier. If no demand transmission is forecast, the SOP process computes its forecasts
internally. According to the demand forecasts, the workload can be computed and smoothed over several
time periods. The resulting workload defines a capacity plan that must be validated by the SOP
management.
The Master Production Scheduling (MPS) process computes the estimated production release of
final products. Then the Material Requirement Plan (MRP) computes, the raw materials demand (push
strategy) to send to the suppliers, or objective stock levels (pull strategy). As in the SOP process, the
demand forecasts are updated either internally or aggregated from the demand forecast information
received from the customers.
In terms of short term processes, i.e. Execution and Control Operations , we differentiate, two
levels: the Short Term Planning (STP) and the Launching Inventory Management (L&IM) processes both
detail the various short term decisions. The Short Term Planning process takes into account the actors
own constraints (i.e. breakdowns), the calculation of the possible production release and, in case of a
pull strategy, the demand to send to the suppliers.
The Launching & Inventory Management process is responsible for taking into account the other
actors constraints (i.e. insufficient delivery), the products inventories update, the calculation of the real
production release, and finally the calculation of the quantities to be delivered to each customer.
These four planning processes are considered according to two points of view: internal
(production), to express ones own production decisions, and external (supply or dispatch), to express the
material requirement to the supplier or the delivery decisions. The Figure 3 illustrates this model.

Figure 3: The generic representation of the supply chain actor's processes

6
4.2 VMI processes

4.2.1 Production and Dispatch processes

The difference between the two ways we have identified to implement the VMI (Integrated and
Dispatch VMI) relies on the propagation of the demand uncertainty in the supply chain.
First, the supplier inherits of the short term decisions of the customer short term supply decision.
Therefore, the customers STP Supply process is replaced by a Suppliers STP Dispatch process (see
Figure 4).
The two short term implementations of VMI differ on the propagation of the demand uncertainty
through the supply chain. Without VMI, the customer demand is a fixed real quantity. With VMI, the
customer gross requirements. The supplier monitors replenishment of customers inventory thanks to the
level of this inventory and the minimum and maximum level established. Finally, the STP dispatch
process computes the net requirement expressed as an interval between a minimal ( D CA ) and a maximal
( D CA ) for each customer C.
With the Integrated VMI, the uncertainty is transmitted all over the chain, first in the STP dispatch
process then in the STP replenishment process. The output of the suppliers STP dispatch process is the
union of these intervals: [D ; D A ] = DC ; DCA . A global replenishment choice is made inside the STP
A U A
C

production by the supplier. Thanks to this decision, the input of the Production L&IM process remains a
scalar desired production. It is not affected by the VMI.
With the Dispatch-VMI, the impact is less severe in terms of modifications. The choice is made
inside the STP dispatch process. The interval is transformed in a scalar at this time independently of the
production constraints. No uncertainty is transmitted to other processes.
VMI also impacts the L&IM dispatch process. However, the quantity of finished products in the
suppliers inventory and the decisions previously taken in production limit the possibilities in terms of
dispatching.
In terms of deliveries, what is available (what was made) is compared to what was required. When
the production is inferior to the net requirement, a solution is to dispatch the production according to the
particular weight of each customer. With VMI, the demand is an interval, [ D CA ; D CA ]. So the value of what
is dispatched belongs to the interval [ DLCA; DLCA ]. Then the supplier has to adopt a VMI behaviour inside the
defined interval.
On the other hand, the L&IM dispatch is affected by the Dispatch VMI just like in the Integrated-
VMI. This is due to the fact that the process takes into account the customers requirements in order to
make the decision and the requirements are expressed in terms of interval.
In a nutshell, the transition between the two versions of VMI takes place in the STP dispatch
process of the supplier. Either this process is neutral, it transmits the uncertainty to the STP production, or
it makes a decision inside the interval and transmits a scalar (Figure 4).

4.2.2 Logistical Agreement (LA)

The LA is particular to one article. There are as many LA as there are articles in VMI context. It is
part of the middle/long term decision-making processes. Both supplier and customer transmit their own
constraints. On the one hand, the customer has to insure a minimum consumer service level and wants to
minimize inventories holding costs according to its own Master Production Schedule (MPS). On the
other hand, the supplier has constraints in terms of MPS, production lead time and transport possibilities
(lead time, frequency, lot size). They have to mutually agree on objectives and constraints of the short
term replenishment and dispatch decision-making. Finally, they fix minimum and maximum customer
inventory level and transport characteristics for a pre-determined period.
Both supplier and customer can have different planning processes frequencies. Ideally, their MPS
processes are perfectly synchronized. So, it is possible to keep the MPS frequency to realize the LA.

7
However, in many industrial contexts, production and product constraints create a gap between suppliers
and customers horizons. In this case, they have to determine a particular frequency for the LA.
Another important choice concerns the expression of the targeted minimum and maximum
customers inventory levels. In the literature, we find two different situations: this target is expressed in
pieces or in days of stock. The choice is made according to the global industrial context and the product
characteristics (demand visibility, variability, nature of the product)
Most of the authors agree on the mutual character of the agreement. Yet, it could be possible to
find authors who describe agreement led by the customer.
The actors have to organize a shared and common plan which will be used to parameter the
customers inventory min/max level. This common plan is built around exchanges between the partners.
The customer expresses its components requirement plan. The supplier gives a delivery plan. Each actor
includes its constraints in this plan. Two situations must be distinguished:
- either, one of the actors, usually the customer, dominates the partnership. In this
case, he imposes its constraints. As a consequence, minimum and maximum are
the direct expression of these constraints. For example, Disney and Towill (2002a)
explain that the customer calculates the re-order point then passes it to the supplier.
- Or, in the well-balanced partnership case, the negotiation is defined by an
exchange of point of views. It is true collaboration in terms of plan building.
Dudek and Standtler (2006) propose an exchanges process helping to the
convergence of the point of views of each actor.

4.2.3 Partnering Agreement (PA)

With VMI, the supplier has a vision of the customers inventory, so that the suppliers tactical
decisions in terms of planned production or planned inventory can be affected. The exchanges between
partners have to be adapted. According to this, the PA defines the whole collaboration process. It
synchronizes the VMI process with planning and scheduling processes of each partner. When modeling
the relationship, many unknowns remain in terms of links specifications. The links are created, but we
have to clearly define them. The following Table 1 summarizes the different questions that have to be
answered in order to integrate the VMI process inside a given collaboration process.

Link Associated question(s) / choice(s)

Type of VMI - Dispatch VMI or Integrated VMI?
Periodicity of the LA - Which horizon?
- Which period of validity of the parameters defined by the LA?
Gross requirement expression Are the suppliers and customers planning process synchronized? And so
where are the shared gross requirement defined?
Shared Forecast - What is shared?
- On which horizon?
- When? (period)
Min/Max customers inventory level How is it expressed: in pieces, in days?
Stock information - How is it expressed: in levels, in consumption?
- Periodicity: real time, hour, day, week
Agreed minimal Transport characteristic What is defined: minimal lot size, minimal delivery frequency?
Table 1: Examples of link specifications at the partnering processes

8
 Figure 4: Implementation of VMI in the actors planning processes

5 Conclusions and future researches

Our study began with the widespread assumption that we knew what VMI was, or at least that the
VMI was perfectly described in the literature. According to this certainty, the initial target was to
implement and then simulate VMI in a simulation tool called LogiRisk. However, if there was no doubt
about the real implementation of VMI in industry, it appears that a consensus about a global definition is
missing. What clearly is VMI and how can it be concretely implemented in the supply chain is not
obvious. It is not clear if VMI is a model, a process, a strategy, a relationship, a link
As a consequence, first of all we have identified all the concepts which surround VMI through the
literature. Thus, the first part allowed the objectives and the considered decision levers to be presented.
This enables to propose an unified view of the process of VMI and its implementation inside actors
planning processes. We emphasize the degrees of freedom obtained by the supplier. According to the
expression of these degrees of freedom, we distinguish two types of VMI: the Dispatch-VMI, only
centered on the deliveries decision and the Integrated-VMI, integrating both production and deliveries
decision.
The Vendor Managed Inventory (VMI) belongs to these collaboration policies which are today
currently implemented in the industry. To define a collaboration policy, managers have to integrate
different sources of uncertainties: evolution of the context or market, partners local behaviors, exchange
processes, Therefore, we plan to use the decision tool exposed by Mahmoudi (2006) for the simulation
of collaboration policies (LogiRisk) to analyze the VMI implementation effect. In this tool, a
collaboration policy is the gathering of:

9
 - a collaboration protocol, VMI for example, that defines the decisional processes between
the partners;
- the union of the decisional behaviors of the partners during their decisional activities. In a
future upgrade, we will thus adapt the LogiRisk prototype to implement the VMI
collaboration policy.
Therefore, the next step of this study is to implement VMI into concerned algorithms (STP
production, L&IM dispatch) and to create the Logistical Agreement. According to this, it could be
interesting to adapt the cooperative planning of Dudek and Stadler (2006), but also to explore other
solutions. The final objective is to simulate the VMI choice in a supply chain and to compare its effects
with traditional collaboration policies. It could allow us to understand the positive and negative impacts of
the VMI and to identify favorable contexts.

6 References
Achabal D., Mcintyre S., Smith S. and Kalyanam K., 2000. A Decision Support System for Vendor Managed
Inventory. Journal of Retailing, 76 (4), p. 430-454.
Blatherwick A., 1998. Vendor Managed Inventory fashion fad important supply chain strategy. Supply Chain An
International Journal, 3(1), p.10-11.
Cetinkaya S. and Lee C., 2000. Stock Replenishment and Shipment Scheduling for Vendor Managed Inventory
Systems. Management Science, 46 (2), p. 217-232.
De Toni A. and Zamolo E., 2005. From a traditional replenishment system to vendor managed inventory: a case
study from the household electrical appliances sector. International Journal of Production Economics, 96, p. 63-
79.
Disney S.M., Towill D.R., 2002a. A procedure for the optimization of dynamic response of Vendor Managed
Inventory system. Computers and Industrial Engineering, 43, p. 27-58.
Disney S.M., Towill D.R., 2002b. A discrete transfer function model to determine the dynamic stability of vendor
managed inventory supply chain. International Journal of Production Research, 40, p. 179-204.
Disney S.M., Towill D.R., 2003. The effect of vendor managed inventory (VMI) dynamics on the Bullwhip Effect
in supply chains. International Journal of Production Economics, 85 (2), p. 199-215.
Disney S.M., Naim M.M. and Potter A., 2002. Assessing the impact of e-business on supply chain dynamics.
International Journal of Production Economics, 89 (2), p. 109-118.
Dong Y. and Xu K., 2002. A supply chain model of vendor managed inventory. Transportation research Part E, 38,
p. 75-95.
Dong Y., Xu K. and Dresner M., 2007. Environmental determinants of VMI adoption: An exploratory analysis.
Transportation research Part E, 43, p. 355-369.
Dudek G. and Stadtler H., 2005. Negociation based collaborative planning between supply chains partners.
European Journal of Operational Research, 163, p. 668-687.
Gentine P., 2002. La gestion partage des approvisionnements peut-elle tre cratrice de valeur ? Accenture.
Grning A. and Holma H., 2007. Vendor Managed Inventory, preparation for an implementation of a pilot project
guidance for an upcoming evaluation at Volvo. Masters thesis. Lulea University of technology.
Hennington E. and Linden T., 2005. Vendor Managed Inventory, enlightening benefits and negative effects of VMI
for Ikea and its supplier. Masters thesis. Lulea University of technology.
Holmstrm J., 1998. Business process innovation in the supply chain a case study of implementing vendor
managed inventory. European Journal of Purchasing & Supply Management, 7, p. 127-131.
Holweg M., Disney S., Holmstrm J. and Smars J., 2005. Supply Chain Collaboration: Making Sense of the
Strategy Continuum. European Management Journal, 23 (2), p. 170-181.
Ireland R. K. and Crum C., 2005. Supply chain collaboration, how to implement CPFR and other best collaborative
practices. J. Ross publishing and APICS. 206 pages.
Kaipia R. and Tanskanen K., 2003. Vendor managed category management an outsourcing solution in retailing.
Journal of Purchasing & Supply Management, 9, 165-175.
10
Kuk G., 2004. Effectiveness of vendor managed inventory in the electronics industry: determinants and outcomes.
Information & Management, 41, p. 645-654.
Lamothe J., Mahmoudi J., Thierry C., Cooperation to reduce risk in a telecom supply chain, special issue Managing
Supply Chain Risk. Supply Chain Forum: An International Journal. To appear vol 8-2 2007.
Mahmoudi J., 2006. Simulation et gestion des risques en planification distribue de chanes logistiques : application
au secteur de l'lectronique et des tlcommunications. PhD.
Mishra B. and Raghunathan S., 2004. Retailer- vs. Vendor Managed Inventory and Brand Competition.
Management Science, 50 (4), p. 445-457.
Nachiappan S.P. and Jawahar N., 2007. A genetic algorithm for optimal operating parameters of VMI system in a
two echelon supply chain. European Journal of Operational Research, 182, p. 1433-1452.
Nachiappan S.P., Gunasekaran A. and Jawahar N., 2007. Knowledge management system for operating parameters
in two echelon VMI supply chain. International Journal of Production Research, 45 (11), p. 2479-2505.
ODETTE, 2004. Vendor Managed Inventory (VMI) (version 1.0).
Rusdiansyah A. and Tsao D., 2005. Coordinating Deliveries and Inventories for Supply Chain under Vendor
Managed Inventory System. JSME International Journal, 48 (2), p. 85-90.
Smaros J., Lethonen JM., Appelqvist P. and Holmstrom J., 2003. The impact increasing demand visibility
production inventory control efficiency. International Journal of physical distribution and Logistics management,
33(4), 336-354.
Tang C., 2006. Perspectives in supply chain risk management. International Journal of Production Economics, 103,
p. 451-488.
Tyan J. and Wee H., 2002. Vendor managed inventory: a survey of the Taiwanese grocery industry. Journal of
Purchasing & Supply Management, 9(1), p.11-18.
Yao Y. and Dresner M., 2007. The inventory value of information sharing, continuous replenishment, and vendor-
managed inventory. Transportation Research Part E: Logistics and Transportation Review, In Press, Corrected
Proof, Available online 9 April 2007.
Yao Y., Evers P. and Dresner M., 2007. Supply chain integration in vendor-managed inventory. Decision Support
Systems, 43 (2), p. 663-674.
Wilson M., 2007. The impact of transportation disruptions on supply chain performance. Transportation research
Part E, 43, p. 295-320.

11
 Appendix A: Utilization rate of expressions to qualify VMI in the

Literature
12