A Standard Agreement For Vendor Managed Inventory

Based on a relevant industrial application, the flow of information and technical details to be defined before commissioning will be identified and discussed. This data is used as key elements to define the basic framework of the agreement. Particular attention is paid to the “Technical Specifications” and “Service Level Agreement” sections. It is demonstrated that an agreement on BMI should be divided into parts dealing with the general and legal aspects of the agreement, while technical and relational aspects should be addressed in the annexes. This increases the flexibility of the agreement, as the VMI relationship evolves over time and the amendments only concern the annexes, with the main part of the agreement remaining unchanged. A supplier-managed inventory contract is a simple way to ensure that inventory arrives on time at the plant.