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Paragon’s Vendor Managed Inventory (VMI) supply-chain management service reduces the price that manufacturers pay for components.

Part of Paragon’s Total Component Management (TCM) solution, the company’s VMI service is central to its belief that OEMs can gain substantial benefits by outsourcing procurement, supply-chain management and logistics to a specialist company.

With its VMI service, Paragon establishes line-side stores at customer premises, enabling instant access to high volumes of parts onsite.

Available as ‘consigned stock’, these parts are only invoiced for when used, reducing customer risk and streamlining supply.

Paragon customers can also report material use in terms of product or BoM, rather than on an individual component basis.

Not only does VMI significantly improve cash flow and improve stock availability, it reduces acquisition costs through reduced material handling and eliminating the need for multiple purchase transactions and processing multiple invoices.

Graham Smith, managing director of Paragon, said: ‘Paragon VMI manages the interface with component suppliers on behalf of our customers, lifting a huge burden from OEMs and releasing vital personnel and resources to focus on tasks that add substantial value.

‘We’ve refined this business model to the point where we can work alongside customers to take the risk and complexity out of their supply chains and deliver exactly what they need to achieve their production goals.

‘For example, if demand is relatively low, our team will prepare custom reels of as little as 100 devices, to save the additional cost and liability of buying in full reels from the manufacturer.

‘We’ll also support all consignments with our own buffer stock for ultimate peace of mind.

‘Plus, customers can even check stock levels of parts held in the line-side store through the secure log-in on our website, ensuring complete transparency throughout,’ he added.

Paragon frequently replenishes the line-side store – typically each week with all products labelled with the relevant customer part number, quantity and location.

Also on a weekly basis, the customer advises what has been manufactured, and Paragon’s forecasting system, which contains full details of the entire BoM, then amends the stock, including an allowance for wastage, and invoices the customer.

This saves the complication of invoicing several thousand line items each month.

A periodic stock check is performed to ensure all stock levels are accurate, and invoice adjustments can be made as appropriate.

Paragon Electronics Components

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