Improvement Of Supply Chain Inventory Management In Foxconn Group

The economic globalization not only brings company new opportunities, but also makes new challenges, and the competence around the world is becoming more and more intensive. The supply chain is the core of company, and the efficient, agile and cost-effective supply chain management will improve the company competitiveness in this changing market. Meanwhile, the inventory management is becoming one of the core in supply chain management. Nowadays, companies have to face an increasingly complex, fast-changing, full of vague and uncertain market environment, which makes the company’s inventory management become more difficult. Inventory exists in all aspects of supply chain, such as raw material, semi-finished product and finished product; so, inventory management not only restricts the performance of the entire supply chain, but also affects the total cost of the company supply chain. With the arrival of the era of meager profit manufacturing, most companies facing severe challenge from cost, and reducing inventory cost has become an important source for companies to get a third-party profit. So, it is necessary to research supply chain inventory management and to find an improved inventory management method that suitable for company development, which has significance to improve the overall operational efficiency of the supply chain for modern enterprises, reduce inventory, achieve low-cost operation, and improve customer service levels and satisfaction.In this paper, based on using the theory of supply chain management and inventory management in supply chain environment, especially Vendor-Managed Inventory (VMI) and Just In Time (JIT) with zero inventory two inventory management theories, the author elaborated the Foxconn Group and the flow of his different functional departments in supply chain, and analyzed the problems and causes of inventory management objectively and particularly by combing the status of high inventory and low operating efficiency of supply chain in Foxconn Group. Accordingly, some strategies for improving the inventory management were proposed:1. Combine the ABC classified inventory management method with supplier position model, which can avoid the supply risk and the inventory affect from different material with different characters effectively;2. Carry out different inventory management for products in different period;3. Optimize the organizational structure of different functional departments in supply chain, launch performance assessment in inventory management, cultivate integral conception of supply chain, and enhance collaboration and coordinate among departments;4. For the system technology support, promote the SAP system and introduce RFID technology, achieve the intelligent inventory management, reduce the chance of human error, so that the data in the SAP system is more accurate, more timely information sharing and transparency;5. Establish strategic partnerships with suppliers, enhance Vendor managed inventory (VMI), improve delivery speed and accuracy, raise inventory stew rate, thus maintaining inventory optimization and achieve win-win results. Based on the five improvements in inventory management that mentioned above, it can realize seamless connection for every point of supply chain, reduce the inventory of the whole supply chain and the total operation cost, and enhance the competitiveness of companies.