How Does VMI Work?
VMI is the automation of the steps involved in placing orders, receiving deliveries, invoicing and paying invoices—probably the most important process for any food and beverage company. To automate the VMI process, EDI is the normal method used. EDI enables the flow of information from one enterprise to the next. Before the advent of VMI, these activities were often manual or semi-computerized, paper based and often unresponsive. The information that changed hands was often not as detailed, complete, timely or as accurate as with VMI. Standard EDI transactions provide a common language for information/data to be exchanged. During the VMI process, the types of transmissions made are, for example, forecasts, purchase orders, inventory activity data and advance ship notices. In the future, these EDI transactions may well co-exist with newer electronic (business-to-business) technologies such as XML. In a typical implementation, VMI activity starts when a supplier receives data from its cu
