6) Lummus et. al concludes that trade promotion are usually used by the manufacturer to stimulate the demand of FMCG and other goods. This creates irregularities in the supply chain because the retailers usually do not foresee a increase in demand from result trade promotion activities and buy too less. This creates supply chain problems for the manufacturers. This creates a bullwhip effect in the entire supply chain. Same thing happen as a result of price fluctuation with retailers trying to buy at frequent intervals rather than purchasing large order at once. A company that is not prepared for it usually is hit badly by it. However, advancement in modern technologies and training of the workforce has helped the companies to solve such problems. VMI and CPFR systems are being used and salesmen are guiding the retailers in order to help the companies and manufacturer minimize the bullwhip effect.
8) CPFR is used by the companies where the retailers and manufacturer work together in order develop supply chain strategies. In order to achieve the goal of this system, there is a need to have synchronized data between the manufacturer and the retailer. There are retail event collaborations where the data about future trade promotions is shared with the retailer. Then there is a DC replenishment collaboration where the orders of DC are locking in as a stream and goods are supplied to the retailers as per the demand. Store replenishment is used to supply the stores with the goods according to the demand of customer. Another type of collaboration is assortment collaboration where the goods that are supplied are according to the changing needs and taste of the customers. (Businessweek.com)
Works Cited
Businessweek.com,. 'Supply Chain Collaboration - CPFR Means Process And Practice'. N.p.,
2014. Web. 28 Oct. 2014.
Works Cited:
R. R. Lummus, L. K. Duclos, R. J. Vokurka, "The impact of marketing initiatives on the supply
chain", Supply Chain Management: An International Journal, Vol. 8 Iss: 4 pp. 317 – 323, 2003
