Achieving Cost Goals Requires More Than Just Managing The Plastic for Injection Molding


One of the measures of confidence and responsibility that B & B Molded Products often receives from its customers is the creation of a vendor managed inventory (VMI) agreement. In effect, our customers trust us to manage product supply levels either back to them for inclusion in their production processes, or directly to their customers (when we produce the finished goods). This can provide a tremendous increase in efficiency and a decrease in total costs. The reason is it eliminates duplication of labor caused by creating unnecessary stock checking, purchasing, payment processes on the customer’s side, which are essentially mirrored on the supplier side anyway. While there are variations for each client the basic process typically includes:

1. B & B Molded Products receives information about current stock levels either in our customer’s manufacturing facility or even at the end customer’s location(s). This is typically done electronically through customer shared data systems

2. B & B determines through internal systems and experience with the product ordering cycles, the optimum amount of finished stock to maintain to keep agreed upon supply levels

3. This results in our customers to lowering their inventory levels, maintaining high service profiles and increasing the return on their investment

There are many ways to structure this arrangement, but it helps B & B Molded Products become a true risk-sharing partner, and allows us to help our end customer manage their capital, lowering total cost of the product through the supply process. More than overseeing one inventory element like the plastic for injection molding, many of our customers are amazed at how well we get to know their total supply needs and how accurately we can forecast and meet those needs even amid rapidly changing market conditions.