There’s a buzz in the manufacturing industry right now, and many shops expect increased demand in the months ahead. As production schedules fill up, early communication with your precision machine shop becomes especially crucial to project success.

In these high-demand periods, Vendor-Managed Inventory (VMI) is a powerful tool to ensure you’re easily meeting your timelines. At Focused on Machining, our VMI program offers a strategic approach to managing part production that optimizes your costs and simplifies delivery.

Find out how VMI operates at Focused on Machining, and learn why this is the perfect time to join our VMI program.

The Simplicity of Vendor-Managed Inventory

In our VMI program, customers share their recurring monthly quantity requirements with us, allowing us to proactively manufacture parts and maintain a stock level to meet their needs. For example, if a customer requires 20 parts every month, they may authorize us to produce and maintain two months of additional inventory on our shelf ahead of time.

This approach ensures consistent availability for our customers, especially for parts needed in steady quantities. Traditional, one-off ordering can be subject to varying production schedules and changes in lead time, but in a VMI relationship, we can plan production runs around your parts.

The Benefits of VMI: Better Pricing, Simpler Supply Chain

VMI is best for medium-volume CNC production machining—typically in the range of 10 to 100 parts per month. It’s ideal for customers who need parts regularly, but not at extremely high volumes that require continuous production. In addition, stable, repeat parts are the best fit—parts still going through frequent design changes are not well suited to VMI.

For qualified customers, there are significant benefits: 

Better pricing: Even when customers have relatively small monthly quantities, they receive better pricing by enabling us to produce parts in larger production runs. A VMI customer ordering 20 parts every month may receive pricing comparable to a one-time 40-piece order.

Consistent supply: Many times RFQs only arrive in our inbox when parts are already urgently needed. Instead, VMI creates a more predictable and reliable supply chain manufacturing relationship. 

Backup availability: When we maintain your parts in our inventory, you can access them quickly if demand unexpectedly increases. Instead of waiting for a full production cycle, parts can ship directly from our stock.

Establishing a Strong VMI Partnership

VMI relationships can differ from customer to customer—we do not have a single template, and instead carefully create a plan with every customer and agree on key terms for our precision machining services. Every successful program addresses these key factors: 

Quantities and timing: Delivery schedules and quantities are the essence of a VMI arrangement, in addition to authorized inventory levels.

Revision control: Both parties must agree on how any potential engineering changes will be handled, including what to do with existing inventory. 

Storage duration: We typically maintain inventory for 30 to 60 days, maintaining adequate stock but regularly turning these parts over. However, if inventory grows or duration increases, it’s critical to have terms agreed upon beforehand.

Communication strategy: VMI simplifies ordering and reduces POs, but it is not a “set it and forget it” program. We frequently communicate with our customers about potential changes in demand, production schedules, and requirements.

Let’s Discuss Your Upcoming Production Needs

At Focused on Machining, our commitment to customer service means we are the ideal VMI partner. We maintain clear communication throughout the relationship, and customers know how responsive we are to every phone call and every email.

Request a quote today from our Colorado machine shop if you think your project is a good candidate for VMI! No matter what your project requires, from titanium machining to production machining services, we’re ready.