Vendor Managed Inventory (VMI) Implementation in Recycled PET Preform for The Beverage Industry

Abstract

The beverage industry is a company that is focused on producing mineral water in Polyethylene Terephthalate (PET) bottles. PET bottles serve as the primary packaging choice in the beverage industry, making the use of preforms as a material for bottles unavoidable. On the other hand, the public is more aware of using sustainable materials. Adapting market awareness, the company shifted from virgin material to recycled material. Due to the significant initial investment, the company has decided on a single supplier strategy for recycled PET preform suppliers. This policy forces the company to manage the supplier to meet the company’s delivery accomplishment target. Currently, in the management of beverage found in the industry, the supplier only reaches 50% of delivery accomplishments, whereas the company target is 90%. The beverage industry strived for a revolution, so the company’s target was achieved. The vendor managed inventory method is implemented in this study to create a new revolution for PET preform suppliers, a new replenishment system. After the implementation of Vendor Managed Inventory (VMI), there has been an improvement, reaching 95% in delivery accomplishment. The adoption of vendor managed inventory ensures the attainment of the company’s objectives.