Implications Of Collaborative Planning,Forecasting,And Replenishment In Supply Chain Management

Abstract

Inventory build-ups have been proving fatal in industries with short product life cycles and high rates of technological obsolescence. Better-managed companies have been looking for best-in-class planning practices to control their inventories and achieve superior results. Collaborative planning, forecasting, and replenishment (CPFR) may be the next great thing in inventory and vendor management and a source of advantage for such companies. CPFR is a set of business processes that are established and empowered by a formal agreement to cooperate on strategy, tactics, and execution by resolution of exceptions. Retailers and suppliers are moving to improve their supply chain through this process. Gradually, they are recognizing the advantages of web-based cooperation to develop a single, more accurate demand forecast and devise a plan for delivering product to meet customer demand. The present article highlights the role of CPFR in supply chain management of an organization.