Principles of Collaborative Planning, Forecasting and Replenishment

Essay by wesdentonUniversity, Bachelor'sA, August 2008

download word file, 4 pages 0.0

To be successful in the retail business organizations must adhere to strict business policies that follow guidelines of production, inventory, forecasting collaboration and replenishment of products. These guidelines assist the company in satisfying the end customer who is the actual consumer of the product. Coca-Cola who produces more than 150 products including soda and water would benefit greatly from a collaborative business practice but with the way that the Coca-Cola Bottling Company, (CCBC), interacts with its customers it hasn't quite achieved this ideal position just yet as they focus more on internal collaboration first. It will be important for the CCBC to remain open to the idea of fully implementing the business practices of CPFR so that each component of the operation can benefit equally.

Principles of CPFRThe CPFR which stands for Collaborative Planning, Forecasting and Replenishment is an established way of doing business created by the Voluntary Interindustry Commerce Standards group, or VICS.

These policies were established to allow each component of the supply chain to be a partner in the success of fulfilling customer demand. "(CPFR) is a concept that aims to enhance supply chain integration by supporting and assisting joint practices. CPFR seeks cooperative management of inventory through joint visibility and replenishment of products throughout the supply chain." "(VICS, 2004)". This practice was created so that suppliers could have greater visibility into retailer's sales forecasts. This allows each business component to have better control over their respective inventories.

Coca-Cola's Bottling OperationsCoca-Cola has a huge bottling operation which produces and delivers more than 125 million cases of its product each year. This consists of sixty distribution centers and five bottling plants just in the South Eastern part of the United States. To accommodate huge amounts of inventory the CCBC had built more than seventy warehouses and...