Co-Chairs
Larry Smith, Sr. VP, Planning & Replenishment, West Marine
Jim Flannery, Director, Customer Business Development, Procter & Gamble
Gary Maxwell, Senior Vice President of Merchandise Replenishment for U.S. Wal-Mart Stores
Mission
The mission of the CPFR Committee is to develop business guidelines and roadmaps for various collaborative scenarios, which include upstream suppliers, suppliers of finished goods and retailers, which integrate demand and supply planning and execution.
The committee is continuing to improve the existing guidelines, tools and critical first steps that enable the implementation of CPFR. It is also developing guidelines for Apparel and the integration of category management with CPFR.
Who should participate?
Senior Managers across functions, including Merchandising and Sales, Planning and Operations, Transportation and Logistics, Information Technology and Finance.
Current Key Initiatives
1. Support new verticals
2. Increase Participation/Quality of Meetings
3. New Metrics Guideline
4. Updated CPFR Capability Assessment
Key drivers
1. Meetings with distinct focus and sponsorship; i.e., Apparel Meeting at Macy’s.
2. Support of Managements, particularly retail.
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What is the focus of the VICS CPFR® Committee?
Implementation, Implementation, Implementation!
Simply put, implementation is our primary focus!
Even though our focus can be simply stated, providing the essential knowledge, support and experience is a challenge we have embraced. The Committee’s strategies have been developed to meet this objective and are evident in our new committee structure.
We have formed subcommittees focussed on tools, metrics, collaborative process refinement and education & certification. We have continued with one industry vertical sub committee for Apparel because of a demonstrated interest in developing CPFR guidelines for that vertical.
We are assembling material developed by VICS, as well as that developed by VICS members, of other industry examples of successful implementations. The materials include collaborative principles, process guidelines, templates and an ROI calculator. We have identified key metrics as well as supporting measures to track compliance and control. Education programs are under development and will be delivered in public forums using the material from the Content and Education subcommittees and incorporating the metrics recommended by the Metrics subcommittee.
The CPFR committee has responded to the high interest level of VICS members and the business community, related to internal collaboration and the linkage of internal to external collaborative processes. An initial focus is to define a process for incorporating customer specific demand into the internal Sales and Operations Planning (S&OP) process.
CPFR has come a long way, with many successful implementations. The committee will now leverage this experience through documentation, education and ultimately certification. At the same time we will continue to define process guidelines based on our member’s interest and the industries’ direction.
Collaboration is a key component in optimizing the supply chain and CPFR, is a time tested method to squeeze inefficiency, time and waste out of the supply chain and to simultaneously increase sales. The VICS CPFR committee is committed to providing our members with tools and training to develop the skills and capabilities to implement Collaboration successfully.
Sub-Committees
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 CPFR Benefits Calculator - PreviewSupplier Benefits Calculator Full Version CPFR Benefits Calculator (6MB). |
CPFR® Business Practices
- CPFR: An Overview of the Model
- Successful Large Scale CPFR Programs and Onboarding Trading Partners
- Collaborative Assortment Planning for Apparel & Footwear
- Store Replenishment Collaboration
- Distribution Center (DC) Collaboration
- Retail Event Collaboration
CPFR: An Overview of the Model
Collaborative Planning, Forecasting and Replenishment (CPFR) is a business practice that combines the intelligence of multiple trading partners in the planning and fulfillment of customer demand. Since the 1998 publication of the VICS CPFR guidelines, over 300 companies have implemented the process. Numerous case studies of CPFR projects document in-stock percentage improvements of 2 to 8% for products in stores, accompanied by inventory reductions of 10 to 40% across the supply chain.
By linking sales and marketing best practices such as category management to supply chain planning and execution processes, CPFR increases availability while reducing inventory, transportation and logistics costs. The experience gained from pilot and production implementations of CPFR over the past six years has yielded many insights. A joint committee of VICS and the Efficient Consumer Response (ECR) organization revised the guidelines slightly in 2001 to incorporate global requirements, sanctioned by the Global Commerce Initiative (GCI). In 2004, the VICS CPFR committee developed a major revision of the CPFR model to integrate innovations and overcome shortcomings identified in the original process. “Overview: Collaborative Planning, Forecasting and Replenishment (CPFR)” introduces the updated model.
Successful Large Scale CPFR Programs and Onboarding Trading Partners
Collaborative Planning, Forecasting and Replenishment (CPFR®) initiatives have moved well beyond pilots to programs governing the majority of sales of large enterprises. In this process, some of the distinguishing characteristics of successful collaborative programs are becoming clear. The purpose of this guideline is to document approaches for implementing and sustaining collaborative business processes, particularly in large scale CPFR programs.
CPFR is a strategy for improving supply chain efficiency and effectiveness by making demand transparency drive the execution of the supply chain participants to maximize value for the end-customer. Fundamentally, the aim of CPFR is to convert the supply chain from a disjointed, ineffective and inefficient “push” system to a coordinated “pull” system based upon end customer demand. Trading partners move to selling through their customer firms (to their end-customers) rather than to their customer firms. The “Implementing Successful Large Scale CPFR Programs and Onboarding Trading Partners – Business Process Guide” will help companies investigating collaborative approaches or those wanting to re-invigorate existing CPFR programs.
Collaborative Assortment Planning for Apparel & Footwear
The assortment planning process for apparel and footwear retailers and vendors is the activity of determining product placement by location and by delivery. Retailers and vendors must work together to build and modify assortment plans based upon financial plans, historical sell-thru data, market trends, and production schedules. The coordination and sharing of this information both internally and among trading partners is critical to delivering the right products to the right place at the right time.
Both retailers’ and vendors’ financial and assortment planning processes affect inventory management, yet the business processes and underlying systems are often not integrated or synchronized between parties. This lack of integration and synchronization creates inefficiencies in the supply and demand chains leading to missed sales, inaccurate inventory, excessive markdowns, unnecessary operating costs, and extended response times. The purpose of this document, “Collaborative Assortment Planning for Apparel & Footwear,” is to delineate best practices that effectively address these challenges and improve assortment planning collaboration and execution.
Store Replenishment Collaboration
Working within the framework of Collaborative Planning, Forecasting and Replenishment (CPFR), Store Replenishment Collaboration aims to link manufacturers and retailers to plan store sales and promotion volumes, calculate store inventory requirements, and respond to on-going operational issues. The objective is to increase sales and reduce out-of-stocks at the most important point of the supply chain: where the consumer purchases the product.
The benefits attributed to store-level collaboration include greater visibility to consumer take-away and overstock reduction. Replenishment accuracy, in-stocks and promotional execution all improve as well. Trading partners have a direct view of how consumers are responding to new products, existing shelf distribution, and promotional take-away. The “Store Replenishment - Business Process Guide” will help retailers and manufacturers planning or executing store-level initiatives by implementing consistent vocabulary and industry guidelines.
Distribution Center Replenishment Collaboration
In this system, trading partners collaborate to improve the accuracy of
The problem of out-of-stocks remains a thorn in the side of the industry. During promotional events, the situation is even worse as the out-of-stock rate doubles while consumer demand peaks. Not only are retailers and manufacturers losing sales and profits, but they are also gambling with the loyalty of their customers because promise of a special deal has not been fulfilled.
In many stores, promotions and other retail events generate the largest swings in demand, resulting in most out-of-stocks, excess inventory and unplanned logistics costs. While the VICS Collaborative Planning, Forecasting and Replenishment (CPFR) Guidelines include recommendations for the entire life cycle, many organizations have sought to focus collaborative efforts on retail events where their financial opportunity is greatest. The “Retail Event Collaboration - Business Process Guide” does just that – outlining a standard business process model for retail event collaboration, along with the implementation guidelines needed to support the process.
Standards & Schemas
On March 21, 2002 the VICS CPFR® Business Message Standards and CPFR® XML Schemas were approved by the EAN-UCC Global Management Standards Process (GSMP) and published by EAN-UCC as Global Standards. GS1 US members may download these standards from the GS1 US Website.
Read the Latest on CPFR®
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How Motorola put CPFR into Action - Supply Chain Management Review, October 2007
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West Marine: A CPFR Success Story, Supply Chain Management Review, March 1, 2006
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Synchronization - Hewlett Packard Style, Supply Chain Management Review, March 1, 2005 - Hewlett-Packard's Imaging and Printing business knew that it had to overhaul its supply chain. The unit constantly struggled with too much of the wrong products and not enough of the right ones, and resellers' complaints were soaring. The answer came in the form of a holistic value chain—an approach that synchronizes the supply chain by working backward from the customer, truly understanding demand, and focusing on business processes instead of technical solutions.
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CPFR for Apparel group launched in
Las Vegas on October 7, 2004 -
Collaborative Practices Research Initiative Sponsored by The Neeley supply and
Value Chain Center, Texas Christian University - November 15, 2004
Executive Summary
PowerPoint Presentation
CPFR® is a Registered Trademark of the Voluntary Interindustry Commerce Standards (VICS) Association
Archives
Title: Taking the Sales and Operations Planning (S&OP) Process the Next Step/VICS CPFR Committee Meeting, April 25, 2006
Delivered by: Larry Lapide, Research Director,
Description: PowerPoint presentation details the importance of the Sales and Operations Planning (S&OP) Process, how S&OP is done, success factors & improving the S&OP process and diagnosing where you are.
Title: P&G CPFR
Delivered by: Jeff LeMay
Description: Short presentation details Proctor & Gamble’s position, status and outlook on various CPFR efforts, the sharing of how CPFR is being used to enable:
Gillette integration, the design of a consumer driven supply network (CDSN) supply network, managing recent changes in customer inventory.
Title: Collaborative Inventory Management at BJ’s Wholesale Club/VICS CPFR Meeting in
Description: PowerPoint presentation outlines the benefits of supply chain integration.
Title: Scaling Collaboration
Delivered by: Andrew White, Research Director, SCM for Gartner, Inc.
Description: Document contains several graphs and discussions of the following: What is the status of CPFR? How is CPFR viewed by end users? What impacts the adoption of CPFR?
Title: Retail Event Collaboration/Review of the Business Process Specification
Delivered by: John Bermudez, VP Product Management, Demantra; Guy Yehiav, VP & GM, Supply Chain Products, Demantra.
Description: PowerPoint covers the topics of Collaborative Event Strategy and Planning Process, Collaborative Event Forecasting Process, Collaborative Event Ordering and Fulfillment Process, Collaborative Event Analysis Process and Information Sharing Requirements.
Title: Collaborative Replenishment
Delivered by: Fred Baumann, JDA Software and Matt Johnson, Retek, Inc.
Description: Presentation covers Process Summary and Business Case, Case Study: Wal Mart Stores, Proposed Industry Process Guidelines (Retailer-Managed Replenishment and Vendor-Managed Replenishment), Business Process Steps and Message Interchange Scenarios.
Title: CMC CPFR Pilot Case Introduction
Delivered by: Phyllis Chang, CMC Magnetics Corporation
Description: Document details CMC involvement with CPFR, including CMC Implement Roadmap (Business Process Design Roadmap and System Development Roadmap); Finding Obstacles and Solutions (Business Process Issue and Technology Lesson Development Issue).
Title: Supply Chain Collaboration: What’s Happening
Originally Printed: The International journal of Logistics Management, Vol. 16 NO.2, 2005
Composed by: Soonhong Min, Anthony S. Roath, Patricia J. Daugherty,
Stefan E. Genchev, Haozhe Chen, Aaron D. Arndt, R. Glenn Richey
Description: An in-depth analysis of supply chain collaboration from an academic perspective.
Title: Joe Andraski Discusses Collaborative Planning, Forecasting and Replenishment with Larry Smith of West Marine.
Description: Larry Smith provides his insights on such topics as the role of forecasting in overall collaboration, how CPFR is improving fulfillment without order forecasting and how CPFR can become more scalable.
Title: VICS CPFR Case Study: Store Replenishment Collaboration at Wal-Mart
Description: Case study outlines the largest CPFR initiative in the world resulting in an in-stock rate improvement of 7.85% for the most active CPFR suppliers.
Title: Effective Supply Chain Management Research Project
Delivered by: Collaborative Practices Research Team, Supply and
Description: Series of graphs illustrate the positive effect of supply chain collaboration.
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