Which inventory arrangement has the manufacturer responsible for maintaining the retailer's inventory levels in each store?

Which inventory arrangement has the manufacturer responsible for maintaining the retailer's inventory levels in each store?

• A. Vendor-Managed Inventory (VMI)
• B. Co-Managed Inventory (CMI)
• C. Supplier Co-Location
• D. Rights and Duties

Answer: (A)

Vendor-Managed Inventory is the arrangement where the supplier takes responsibility for monitoring the retailer’s stock levels and replenishing inventory in each store to keep products on the shelf at agreed levels. The retailer shares sales and inventory data with the supplier, who then plans and ships replenishments, reducing stockouts and easing store-level logistics. This contrasts with co-managed inventory, where control is more shared, and other terms aren’t about the supplier owning and maintaining in-store inventories.

Vendor-Managed Inventory is the arrangement where the supplier takes responsibility for monitoring the retailer’s stock levels and replenishing inventory in each store to keep products on the shelf at agreed levels. The retailer shares sales and inventory data with the supplier, who then plans and ships replenishments, reducing stockouts and easing store-level logistics. This contrasts with co-managed inventory, where control is more shared, and other terms aren’t about the supplier owning and maintaining in-store inventories.