Supply Chain Management Quiz

Advantages of VMI

• VMI for the buyer offers fewer stock-outs with higher inventory turnover and early recognition of fluctuation in demand.
• VMI for the vendor offers optimization of production planning, closer customer ties and preferred status, and early recognition of fluctuation in demand.

Logistics Sequence

• The correct logistics sequence of an organization is acquisition of resources, transformation process, and delivery to customers.

Logistics Terms

• Lead time is the time that elapses between issuing replenishment order.
• Cross-Docking targets the consolidation of goods and connects inbound and outbound logistics processes.
• 3PL (Third Party Logistics Provider) typically offers contract logistics services and is not limited to warehousing in terms of business.

Supply Chain Management

• Seasonal stocks are established to buffer seasonal produced goods and cover demand peaks.
• Actors that are not part of the supply chain community include competitors.
• The typical aim of the push to customer approach is to enhance product and service quality, reduce costs of distribution, and optimize the production process for cost and efficiency.
• SCM design and SCM execution must primarily handle demand uncertainties, exchange rate uncertainties, and supply uncertainties.

Expected Advantages of VMI for the Buyer

• VMI helps reduce stock-outs while increasing inventory turnover, ensuring that inventory levels are maintained at an optimal level.
• This approach enables buyers to recognize fluctuations in demand earlier, allowing for proactive adjustments to their inventory management strategy.

Test your knowledge of supply chain management concepts, including inventory management, logistics, and customer service.