What does it mean to have a spare parts store in the warehouse by the supplier

This management model is called VMI, full name Vendor Managed Inventory, that is, Vendor Managed Inventory. It is a mode of inventory operation in a supply chain environment that, in essence, turns a multi-level supply chain problem into a single-level inventory management problem, as opposed to the traditional practice of replenishment in accordance with the traditional user-issued orders. VMI is the actual or predicted consumer demand and inventory, as a solution to market demand forecasting and inventory replenishment, that is, by sales information to get consumer demand information, suppliers can be more effective planning, more rapid response to market changes and consumer demand. To be clear, that is to say that companies no longer prepare goods inventory, but let the supplier to prepare inventory, generally this is the case of a more stable supply relationship, you can ask the supplier to do so. For example, your company often use material A, the monthly procurement of 1000 pieces to the supplier, then the 1000 pieces you will not buy back, but ask the supplier in their warehouses to stock 1000 pieces, you want to use the time and then under the purchase order notify the supplier to deliver over. The benefits of doing so, one can save labor, warehousing costs; two is to save the cost of inventory backlog of goods; three is to reduce the incidence of chaos of goods, and so on.