As companies struggle with cost pressure, strikes (and other labor shortages), and lack of warehouse space, we’ve seen an increasing desire and likelihood to limit the scope of what moves through OEM warehouse networks, or how much work is applied during its journey through the network. There are two ways to serve dealers from outside the network. First is the more traditional vendor ship direct – certain part types or parts from certain suppliers are delivered directly to dealers without ever entering OEM networks. Second is the newer (but still not brand new) “bypass” where some parts from some locations may skip network nodes on their way to the dealer. Both should eliminate work on the warehouse network and reduce cost, perhaps at the expense of customer service. This session will cover both approaches, and will include: What products are on VSD at each OEM? Who are the providers? How do OEMs balance between control and cost when selecting when to remove a part or part type from the network?  Which part types are good candidates for these strategies? Which are not? When does an OEM terminate the strategy either based on poor vendor performance, poor satisfaction, or poor costs? For VSD specifically: How do OEMs select a VSD vendor/supplier? How many is the right number to have?  How are VSD vendors incentivized to perform? Are there penalties for underperformance?