PRESENTATION ON CPFR

MBA-2015

Presented By: Rupali TawarSch. No 142121011

MBA-3rd Sem

MAULANA AZAD NATIONAL INSTITUTION OF TECHNOLOGY

CPFR

Collaborative, Planning, Forecasting, and

Replenishment

What is CPFR…?•A business practice •Trading partners working together in planning fulfilling customer demand.

Links sales and marketing best practices to supply chain planning and execution processes.

Objective is to increase availability to the customer while reducing inventory, transportation and logistics costs.

Three modes of CPFRBasic CPFR: a limited number of business processes integrated between a limited number of supply chain partners

Developed CPFR: will typically involve a greater number of data exchanges between two partners, and may extend to suppliers taking responsibility for replenishment on behalf of their customer.

Advanced CPFR: goes beyond data exchanges to synchronise forecasting information systems and coordinate planning and replenishment processes

SARA LEE

Federated Dept. Stores

MeadSchool & Office

Kimberly Clark

JCPenney

VF Corp.

Staples

CPFR® Initiative Participants

Challenges in CPFR•Selection of CPFR partners.

•Senior Management Buy In.

•Confidentiality.

•Cultural Change.

The CPFR Reference Model 8 collaboration tasks form

cycle of 4 activities:

A. Strategy & PlanningB. Demand & Supply

ManagementC. ExecutionD. Analysis.

Each activity consists of two collaboration tasks.

Strategy & Planning•Establish the ground rules for the collaborative relationship. •Determine product mix and placement, and develop event plans for the period.

Sales forecasting: Projects demand at the point of sale

Order planning/forecasting: (a)Determines future product order & delivery

requirements based upon the sales forecast. (b)Takes into account inventory positions, transit lead

times, shipment quantities, and other factors.

Demand & Supply Management

ExecutionPlace orders, prepare and deliver shipments, receive and stock product on retail shelves, record sales transactions and make payments.  •Order generation— Transitions order forecasts into firm demand •Order fulfillment — Producing, shipping, delivering, and stocking the products

Monitor planning and execution activities for exception conditions.

Aggregate results, and calculate key performance metrics.

Share insights and adjust plans for continuously improved results

Analysis

Steps in CPFR Model

The Voluntary Interindustry Commerce Standards (VICS) developed a 9 step approach to guideline businesses to develop agreements for collaboration. VICS 9-Step Approach•Develop the Front End Agreement•Create the Joint Business Plan•Create the Sales Forecast•Identify Exceptions for Sales Forecast•Resolve/Collaborate on Exception Items•Create Order Forecast•Identify Exceptions for Order Forecast•Resolve/Collaborate on Exception Items•Order Generation

Benefits of CPFR•Improved customer service trough better forecasting techniques•Lower Inventories for higher profits •Improved ROI on Technology investment •Improved relationships between trading partners •Cost reduction 

CPFR is a great concept that has revolutionized business practices by integrating the organization with its trade partners more effectively to realize mutual benefits. Buyers benefit from reduced prices, better forecasting, collaborative relationships to get better service levels and synchronized operations

Conclusion

THANK YOU