Vendor Managed Inventory
Vendor Managed Inventory That Keeps You Stocked
Millwood’s Vendor Managed Inventory (VMI) programs ensure you never run out of the pallets and materials your operation depends on. Relying on in-person oversight, our VMI services deliver supply chain inventory optimization that reduces downtime, balances stock and guarantees accurate counts across every SKU.
How Vendor Managed Inventory Works
We tailor our VMI services to your operation. The most hands-on approach involves a Millwood driver or employee visiting your location regularly to check each pallet SKU, recording counts and placing replenishment orders within your set min/max thresholds. Alternatively, your team can send us daily reports for fulfillmen or direct digital links between your system and ours for seamless tracking.
Why Choose Millwood for VMI Services
Unlike generic supply programs, our vendor managed inventory options are built into the pallet cost and designed to eliminate shortages caused by inaccurate records or remote ordering. We help you track usage, maintain stock at every level and keep your supply chain running smoothly.
Complex Packaging Needs? No Problem.
We know that no two applications are the same. That’s why we use our ISTA-certified Millwood Lab to test each end-of-line-packaging application against your exact load and handling requirements. Our approach avoids:
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Under-engineering that can result in load failure and product damage
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Worker safety hazards that may result in high employee turnover
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Instead, we deliver a just-right solution—balanced for strength, cost and ease of operation
Why Choose Millwood as Your Solution Provider?
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Customer Centric Approach: We collaborate closely with customers, providing personal service and responsive support to meet your unique needs.
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Industry Expertise Since 1985: With over four decades of experience, Millwood understands the complexities of pallet design and supply chain logistics.
- Innovative Design & Testing: Our in house ISTA certified lab and Pallet Design System (PDS) enable tailored, optimized pallet solutions.
- Manufacturing Experts: From sawmilling, resawing, assembly, heat treating and mold prevention, we have the experience and knowledge to serve you.
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Sustainability Commitment: We are committed to efficiency without compromising our environment.
Frequently Asked Questions
What is Vendor Managed Inventory (VMI) and how does it work?
Vendor managed inventory (VMI) is a supply chain strategy where suppliers monitor and replenish customer stock levels directly. It reduces administrative burden while improving efficiency and stock availability.
VMI shifts inventory responsibility to the supplier, who uses real-time data to ensure customers always have the right stock levels. This eliminates guesswork, reduces costly stockouts and streamlines procurement. By allowing suppliers to handle replenishment, customers save time and focus on core operations. Vendors, in turn, gain clearer visibility into demand, leading to stronger partnerships and fewer disruptions. This proactive approach makes VMI services a critical tool for modern supply chains.
What are the benefits of vendor managed inventory services?
Vendor managed inventory services reduce costs, improve efficiency, strengthen supplier relationships and help companies maintain consistent stock levels.
By consolidating replenishment processes under one vendor, businesses eliminate inefficiencies tied to multiple purchase orders, invoices and supplier communications. VMI reduces stockouts by ensuring products are always available when needed, avoiding production delays and lost sales. It also lowers administrative overhead and improves forecasting accuracy through shared data visibility. Over time, companies enjoy reduced carrying costs, streamlined supply chains and stronger long-term supplier relationships. VMI provides both immediate savings and lasting competitive advantages.
How does Vendor Managed Inventory improve supply chain inventory optimization?
Vendor managed inventory improves supply chain inventory optimization by minimizing stockouts, lowering carrying costs and reducing administrative workload.
When suppliers manage replenishment directly, businesses avoid excess inventory while maintaining optimal stock levels. This balance prevents over-ordering and costly warehouse storage fees, while reducing the risk of production downtime caused by stockouts. Additionally, fewer purchase orders and invoices reduce administrative costs, freeing up time for other supply chain priorities. Improved demand forecasting and supplier alignment further minimize waste and transportation inefficiencies. In short, VMI reduces both direct costs (inventory and freight) and indirect costs (labor and administration), delivering measurable bottom-line improvements.
Can Vendor Managed Inventory be used for more than pallets?
Yes, vendor managed inventory (VMI) can manage far more than pallets. It can extend to packaging materials, stretch film, lumber, crates and other supply chain essentials.
While VMI is often associated with pallet supply, their benefits apply across a wide range of consumables and packaging products. Companies using VMI can include stretch wrap, corrugated boxes, protective packaging and even repair-and-return programs in their agreements. By allowing one trusted vendor to monitor and replenish multiple categories of inventory, businesses gain stronger visibility, fewer stockouts and simplified procurement. This holistic approach reduces the complexity of managing many suppliers, while ensuring consistency and efficiency across the entire supply chain network.
Which industries benefit most from vendor managed inventory?
Industries with complex supply chains and high inventory turnover—such as manufacturing, retail, automotive and packaging—benefit most from vendor managed inventory (VMI).
For manufacturers, VMI ensures production never halts due to missing parts or packaging. In retail, it prevents out-of-stock scenarios that frustrate customers and hurt sales. Automotive companies depend on precise inventory coordination to keep assembly lines running efficiently. Packaging and distribution networks also benefit from consistent supply and reduced freight inefficiencies. Any industry managing multiple vendors or requiring precise inventory control gains a significant advantage by using VMI services to streamline operations, improve forecasting and strengthen vendor partnerships.