A VENDOR-MANAGED INVENTORY PROGRAMME IN THE GAS INDUSTRY IN THAILAND

Abstract

This paper summarizes a project to design a vendor-managed program (VMI) for a Gas Producer/Supplier Company in Thailand.  One customer (buying one type of gas) was chosen as a pilot.  The VMI concept becomes increasingly beneficial in delivery value to the customer, through cutting inventory cost, solving shortage problems, eliminating emergency transportation costs, improving reliability, and enhancing relationships between the Gas Company and its customers.

The project simulates the process of VMI for one of the key customers in the local market.  The process design, to improve the supply chain processes, focuses on removing supply planning activities from the customer site by the Gas Company.  The results from the simulation provide an optimal solution before the actual implementation which will affect the flow efficiency of distribution, and cause considerable saving of resources and the creation of a value chain in the supply chain.