Some important terms related to supply chain instability

Point of sale (POS): Point of sale (POS) refers to the payment counter in a retail store where
customers pay for their purchased goods. When a customer picks out a product and wants to check
them out, a culmination of hardware and software helps businesses make those sales. It helps
customer management be easier and the time taken is the bare minimum.

Electronic data interchange (EDI): Electronic Data Interchange (EDI) is the computer-to-computer
exchange of business documents in a standard electronic format between business partners. By
moving from a paper-based exchange of business document to one that is electronic, businesses
enjoy major benefits such as reduced cost, increased processing speed, reduced errors and improved
relationships with business partners.

Computer assisted ordering (CAO): It is a system that uses computer software to assist with the
process of ordering goods or services. It typically involves the use of a computer program or system
that is designed to streamline the ordering process and make it more efficient. CAO systems can be
used by businesses of all sizes, and are particularly useful for companies that receive a large volume
of orders or have a complex ordering process. They can help to reduce the time and effort required
to process orders, and may also provide valuable data and insights about customer purchasing habits
and preferences.

Vendor managed inventory (VMI): Vendor-managed inventory (VMI) is an inventory management

technique in which a supplier of goods, usually the manufacturer, is responsible for optimizing the
inventory held by a distributor. Vendor managed inventory (VMI) is an arrangement where suppliers
manage inventory levels that have been pre-determined. In short, the supplier takes decisions on
behalf of the retailer wherein the supplier replenishes the inventory continuously. Also known as
managed inventory, VMI is a data-driven with advanced procurement software, which can help
vendors plan shipping and production dates in advance to minimize stock-out risks.

Lead time: Time taken from receiving a order to final delivery of goods

Echelon inventory: Echelon inventory is defined as the inventory between a stage in the supply chain
and the final customer. This helps when we are determining the safety inventories at an individual
stage in the supply chain because it will depend not on the local inventory but it will depend on the
inventory that is available at the previous and next stages too and will help in minimizing the safety
inventories for the individual stages

Continuous replenishment: Continuous replenishment is a strategy in which businesses share

inventory information with suppliers, allowing those suppliers to automatically replenish inventory
when needed. Automating inventory replenishment helps reduce logistics and warehousing costs
and aligns production with demand. This arrangement benefits the suppliers, too, as they can
effectively plan for production. Plus, this strategy eliminates the need to generate purchase orders,
thereby simplifying order processing.

Every day low pricing (EDLP): is a pricing strategy in which firms promise consumers consistently low
prices on products without having to wait for sales events. In such a pricing strategy, a firm sets a low
price and maintains it over a long time-horizon (given that product costs remain unchanged).