planning and replenishment in the supply chain

Technology Favors Collaborative Replenishment Focused on Profitability

Let’s say that all business areas in your company are aligned in the strategic planning, walking in the same direction, which eliminates noise and, consequently, reduces internal conflicts. Is this alone a guarantee of success in sales? The current dynamics of planning and replenishment in the supply chain has been showing that it is not. After all, there is little advantage for your company to be aligned internally if the other agents have other concerns that impact your business.

In response to this challenge, we have the CPRF (Collaborative Planning, Forecasting and Replenishment) methodology, which suggests collaborative replenishment, integrating the main business partners to your company’s planning. It may seem complicated at first, but the specialized technology proves it is not. And you’ll know why on this blog post.

Before deploying the technological solution, the first step for the collaborative replenishment to occur is to define the rules of the process, a step that can customize how the relationship between retail and industry will work, considering the differentiated strategies and interests between them. This can even be added to an agreement to ensure the reliability of the process, expanding the level of maturity in management between the links in the supply chain.

After this agreement, the technological solution specialized in supply chain comes into play. One of the major gains with it is the establishment of a collaboration work flow, which organizes the flow of activities and streamlines internal planning, allowing for synergy between the areas of the company (trade, production, sales and marketing).

Furthermore, the collaboration work flow creates mechanisms to also integrate your company’s main partners in the strategic planning step, helping to decide which agents demand more energy from your operation. This action brings the parties closer and helps to align the planning and replenishment expectations, aiming to expand the margin and profitability for all.

Another advantage is the stage called consensus in the collaboration work flow. This phase contributes to the fulfillment of the agreement, providing warnings that favor collaborative replenishment, improving the availability in retail. It is noteworthy to point out that the initiative for this project can come from either the retail or the industry.

In addition to promoting the integration of information in the supply chain, technology helps provide statistical data (considering the sales history) to support decision-making. This is essential to have a more precise look over product management, considering seasonal factors and other relevant information (such as the high consumption of a certain item in a given store and fewer sales in a store from another region).

With the specialized technology, it is highly feasible and possible to establish an aligned collaborative process, along the lines of the CPFR methodology, enabling real benefits to the supply chain, such as increased productivity, operational efficiency and, consequently, competitiveness.

Download our cloud integration white paper to learn the five reasons S&OP belongs in the cloud.

Download 5 Reasons S&OP Belongs In The Cloud White Paper


Author

NeoGrid is a global software company providing a cloud-based suite of supply chain synchronization solutions that enable our clients to simultaneously reduce out-of-stocks (OOS) and inventory levels.

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