Question

What are the different CPFR scenarios and how do they benefit supply chain partners?

Answer 1

What are the different CPFR scenarios and how do they benefit supply chain partners?The four scenarios that sellers and buyers can collaborate along include:Retail event collaboration – the identification of specific SKUs that will be involved in sales promotions and sharing of information regarding the timing, duration, pricing, advertising, and display tactics to be deployed. The benefit of retail event collaborations is a reduction in stockouts, excess inventory and unplanned logistics costs.DC replenishment collaboration – the forecasting of DC withdrawals or demand from the DC to the manufacturer is converted to a stream of orders that are lockedin over a specified time horizon. A successful DC replenishment collaboration reduces production costs at the manufacturer and inventory and stockouts at the retailer.Store replenishment collaboration – the forecasting of store-level orders that are committed over a specific time horizon. Such a collaboration results in greater visibility of sales for the manufacturer, improved replenishment accuracy and product availability, and reduced inventories.

Answer 2

Reduced stock-outs, improved inventory management, shorter cycle times, increased sales revenues, stronger trading partner connections, greater overall system visibility, customer service, and lower cost structures are all benefits of a successful implementation of CPFR.

Collaborative planning, forecasting, and replenishment (CPFR) is an acronym for collaborative planning, forecasting, and replenishment, a practice created to lower supply chain costs by collaborating across several stakeholders in a single supply chain.