Strategy Design for Vendor Held Stock with Consignment Model to Gain Competitive Advantage

Abstract

Vendor Held Stock is a supply chain optimization strategy commonly adopted for oil and gas commodities and renewable energy. Vendor Held Stock is developing the Vendor Managed Inventory concept on the Consignment Model, where vendors provide additional storage and inventory management services, procurement, and delivery. PT IMC is a company operating in the field of energy supply, implementing Vendor Held Stock scheme with a Consignment Arrangement. This study aims to design a priority strategy for optimizing the Vendor Held Stock scheme to increase the company's added value in its market expansion efforts. Interviews and questionnaires were conducted on divisions directly involved in the High-Speed ​​Diesel Bio Solar distribution operations, such as the Operations and Commercial Division and the Cargo Distribution Center Division. Strategy design is carried out by identifying the company's internal and external environment by analyzing Strengths, Weaknesses, Opportunities, and Threats, preceded by the Internal Factor Evaluation Matrix, the External Factor Evaluation Matrix, and the External Internal Matrix. Priority strategy is determined using the Quantitative Strategic Planning Matrix. The strategy with the highest Total Attractiveness Score was chosen as a proportionality strategy where "Changing the status from an Agent to a General Trading Permit to get more competitive price" obtained the highest total attractiveness score with a score of 7,2478. Focusing on the strategy is expected to increase company competitiveness globally