Vendor Managed Inventory systems require integration of distribution and routing which constitute the Inventory Routing Problem (IRP). IRP involves decisions on timing of deliveries, on sizes of shipments and on routing of vehicles. An IRP with a single manufacturer which supplies a product to a set of warehouses is taken for this study. We develop an Integer Linear Program to model the problem. We propose a three-phased approach called CAR, i.e., Clustering of receiver nodes, Allocation of quantities to these nodes and Routing of delivery vehicles through clusters of nodes. We develop two heuristics, based on this approach. Trials conducted over a large number of data sets provide encouraging results.