What is Vendor Management System or VMS?

A Vendor Management System (VMS) is an Internet-enabled, often Web-based application that acts as a mechanism for business to manage and procure staffing services – temporary, and, in some cases, permanent placement services – as well as outside contract or contingent labor. Many times the term VMS will also refer to the Account Debtor (ECapital’s client’s customer) who is the outsourced vendor of the larger Fortune 1000 company versus the Fortune 1000 company itself.

For example, one large VMS company will supply all the nurses to multiple hospital locations and procure those nurses from local smaller staffing companies (ECapital’s clients). ECapital’s client will then bill the VMS and factor the invoices generated with ECapital. The availability of Credit Protection can be a critical component in these type 3rd party transactions as VMS companies have filed for bankruptcy in the recent past.

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