Study On Optimization Of GM’s Inventory Management On The Basis Of VMI

With the global financial crisis continuing to spread, retail market changingfrom seller market to buyer market, consumers’ increasingly stringent demand forcommodities and demand diversification, retail enterprises’ development becomesextremely difficult. Recently, with the pace of the opening up having accelerated,China mainland with enormous market potential attracts a large number of foreignretail enterprises to enter the China market, making the Chinese retail industry thatoriginally struggle face greater competition challenges. Thus, it is inevitable choicefor them to implement supply chain and choose appropriate inventory managementmethod. In2011China top100chain enterprises ranking，Sunning and GOME aretied for second with sales of110billion yuan, but they all reduce40billion yuan ofales, however, at the same time, Wal-Mart and Yum have a tendency to catch up withthem. In our country, supply chain management rises late, facing so many strongcompetitors, improving inventory management in the supply chain becomes Chineseretail enterprises life-saving straw.For retail enterprises, using modern inventorymanagement method can greatly decrease inventory cost and improve profit margins.Enterprises can use VMI to better their inventory management, but how tomake full use of the effectiveness of this strategy depends on enterprises’ VMIprogram design and technology acquisition. It needs enterprises to advance controlthe problems in implementation process, continue following up on the VMIimplementation effect to ensure the problems be solved in time and its success.Regarding the inventory development status of domestic and foreign retailenterprises as the starting point, the article analyses the existing retail inventorymanagement methods and the difference between them, dissects the existingproblems and reasons of GM’s current inventory management method, and analyzesthe inevitability of selecting the VMI inventory management strategy; finally,designs the inventory management optimization program to improve the level ofGME inventory management. Carrying out GM VMI inventory managementoptimization, we must first build a three-core support system, that is, salesforecasting module, inventory decision module, logistics planning module; then, weneed to make preparation for the implementation of the optimization program:choosing a better partner, restructuring of business process, introducing moderninformation technology. GM VMI inventory management optimization program implementation should be taken in three stages:(1) the conceptual design phase. Thetwo sides through consultation mechanism to determine the parameters of eachmodule and the overall objectives and design related procedures.(2) Pilot phase.When implementing the program, we must use simple statistical software as well,such as Excel, to detect the problems of the VMI system and identify the causes andsolutions.(3) The implementation stage. Fully operate the VMI inventorymanagement system, strengthen the supervision of the new system operation, timelyfeedback and constantly improve inventory management model. In the end, the paperconcludes the problems that should be noted in the implementation process of theoptimization program and put forwards the corresponding solutions.By studying on GM’s inventory management, the paper hopes it can help GMimprove the level of inventory management and forward rich VMI applicationresearch, at the same time, hopes it can provide experience&reference for Chineseretail enterprises to optimize their inventory management in global financial crisis.