Question

Frito-Lay is an example of a company that partners with retailers by implementing a(n) __________ system, involving taking on the responsibility of managing inventory levels at the retailers where its products are sold.

A. Franchise management
B. Vendor-managed inventory (VMI)
C. Supply chain optimization
D. Dynamic pricing strategy

Answer 1

Frito-Lay partners with retailers by implementing a Vendor-managed inventory (VMI) system, taking responsibility for managing inventory levels at retailers where its products are sold. Therefore, correct option is B.

Step-by-step explanation:

Frito-Lay's partnership with retailers by implementing a Vendor-managed inventory (VMI) system involves taking on the responsibility of managing inventory levels at the retailers where its products are sold. This means that Frito-Lay monitors and controls the inventory levels to ensure that the right amount of products is available at the right time.

A VMI system allows Frito-Lay to have greater control over its supply chain and ensures that the retailers always have sufficient stock without the risk of overstocking or understocking. By managing inventory levels, Frito-Lay can optimize its supply chain and improve efficiency.

Examples of other companies that use VMI systems include Procter & Gamble and Coca-Cola. These companies take on the responsibility of managing inventory levels at the retailers to ensure a smooth and efficient supply chain.