A retail garment supplier implemented VMI
but continues to face issues to this day. The Swiss sportswear
manufacturer ODLO uses VMI with both customers and
suppliers. On the downstream side to customers, VMI binds
them to their resellers while improving their availability and
minimizing lost sales. In some cases, retail partners demand
that ODLO manage the inventory in their stores. The efficiency
of the process, however, only can be as good as the data
and people on which it depends.
ODLO’s VMI suffers from divergent master data and
product identifications in multiple ERP systems, which make
it difficult to align the partners in the supply chain. Information
management that requires ongoing correction leads
to inaccuracies in actual stocks on hand and, ultimately,
suboptimal demand-supply matching.
The VMI-readiness score (300) was in
the 51 percent to 75 percent range for
this company, which suggests that it
generally is suited for the VMI integration
it strives for. The company’s use
of VMI was consistent with the framework’s
prediction, but obviously there is
room for improvement.