Caonima Fansile Essay

282 Words2 Pages
1. What are the specific problems forcing Henkel to consider CPFR? Skyrocketing level of sales promotion in laundry detergents taxed the sales, production, distribution seriously. Lack of precise long-range forecasts caused production cost to skyrocket. Sales of promotion are always hard to forecast. However CPFR helps supply chain company to be a cohesive, efficient group. By CPFR, manufacturers, suppliers, and retailers can develop more accurate forecasts and inventory levels. 2. What are some of the symptoms? What are the root causes of those symptoms? The reality of implementation was daunting. There was no company had fully implemented a CPFR program. The CPFR was still in the formative stages. The lack of a single reporting standard across the industry. Products were defined differently along every stage of the supply chain. Each company used different software systems for recording, processing, and transmitting data. It is difficult for many companies to bridge the gap between production and sales organizations. Members of supply chain industries were divided on how to promote standards and facilitate implementation. The companies were unsure of the best way to go forward. 3. Should Henkel reduce product complexity, perhaps by adopting an every day low price (EDLP) strategy? Or, should they continue to offer new products and promotions while implementing CPFR or another initiative? Henkel should not reduce product complexity. Using every day low price strategy is not good enough for Henkel. Henkel should continue to offer new products and promotions while implementing CPFR. 4. What are the implications of these different approaches on raw material costs, inventory related costs, profit margins, etc. 5. Which approach do you think retailers would prefer? 6. Make a recommendation for the implementation

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