VMI systems offer automatic purchasing features, so the manual process of purchase orders for mundane items that go into the dispensing system is eliminated. The average time/personnel cost of a purchase order is $150. With automatic purchasing, time is saved and personnel may be eliminated or reassigned to more productive tasks.

Accountability is an issue with many shops. The capacity to control waste and inventory levels is a big selling point where tight budgets and cutbacks are the norm. Typically point-of-use systems reduce overall consumption by 20 percent.

These savings come from four key areas:

1. Increased accountability makes shop workers more careful of what they use and how much.
2. Dispensing in the correct package quantity means less waste.
3. Setting upper control limits for a specific process ensures that tools are not needlessly wasted. Supervision is forced to deal with an out-of-control process now and not when the shop has consumed every tool needed for the operation.
4. A pull system of dispensing tools and supplies is a component of lean manufacturing and can reduce both inventory and the cost of ownership. Keep in mind that only 35% of the cost of ownership is the purchase price of an item. The remaining 65% is made up of receiving, counting, storage, disposal and handling costs. With automated dispensing, many distributors will stock the machines, keep an eye on the reorders and handle disposal of used items. This is more efficient for the shop, provides signifigant savings and frees up personnel for more critical tasks.