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Inventory Management Model 1 - Report Inventory Levels, Buyer to Seller, Version 1.0
Status:  Provisional Draft in process.  Created as part of recast of Consignment Scenarios (Balloted and Ratified by Membership, August 1998)

Business Overview

Special Notes:

An Inventory Report is used in several contacts to exchange information about inventory levels and inventory movements.  It is used to inform the seller of the inventory status and movements, within appropriate time frames.

Inventory Reporting and Replenishment

Inventory Models are used in the context of Supplier-Managed Inventory (SMI) requiring the reporting of current inventory levels and/or consumption data.  See the Replenishment Scenario Matrix.  The buyer uses the Inventory Report to report consumption of inventory instead of embedding it in an Consumption Schedule (SMI Forecast) or sending a separate Report of Inventory Consumption.

For forecast-based SMI, the buyer sends its supplier forecasts of planned consumption and its anticipated production requirements, typically using a weekly forecast message.  Additionally, the buyer may send an Inventory Report more frequently (typically daily) to the supplier, detailing current stock levels, new quantities received into inventory, and quantities which have been consumed since the previous report. From this data, the supplier calculates schedules and delivers product to maintain the level of inventory defined by the buyer.

For consumption-based SMI, consumption data is used by the supplier to calculate and schedule deliveries in order to maintain the level of inventory defined by the buyer.

For inventory not on consignment, change of ownership of the product occurs when the product is received by the buyer.

Inventory Reporting and Consignment

Inventory Models are used in the context of consignment.  See the Consignment Scenario Matrix.

Inventory owned by the seller is physically located at buyer’s facility, the facility of the buyer's agent, or the facility of the seller's agent.  Ownership of the inventory remains with the seller until the event that triggers change of ownership occurs.  The buyer or agent performs inventory counts and reports to seller (scheduled, as-needed, or at seller request).  The seller may invoice for inventory shrinkage.  A buyer holding consigned inventory (on site or at agent's site) may also use the Inventory Report to report billable consumption of inventory or other event that triggers transfer of ownership instead of sending a separate Report of Inventory Consumption.

Frequently, trading partners engage in programs that combine Supplier-Managed Inventory and Consignment.  This is really not as complex as it sounds if one realizes that the former is about deferring planning of inventory replenishment, and the latter is about deferring billing and payment.

See also Assumptions in the supporting documentation.

Overview (Use Case) Diagram    Narration


Narration   Overview (Use Case) Diagram

To be developed

Last updated 01 February 2003