Manufacture's Ordinary Implementation and Operation of CPFR - A Case Study of Shoes Industry

The improvement of product quality and service level has led the increment of customer expectation. For price, innovation, and speed issues, leading manufacturers should search for well-behaved partners to form a powerful supply chain. To improve the efficiency of supply chain execution, reducing supply tiers and demand echelons seems to be a right direction. Therefore, for generic products, direct integration of channel groups and manufacturing groups will be a trend. In recent years, the concept of CPFR (Collaborative Planning, Forecasting & Replenishment) has become one of the most popular supply chain management strategies. One of the main problems to implement CPFR is that most manufacturing groups are not well prepared. They cannot provide sufficient flexibility on lead time and ordering quantity to support customers’ rush orders. This paper utilizes application of world-wide shoes industry to illustrate the requirements provided by manufacturing groups to coordinate channel groups in CPFR. Finally, this paper provides a simple example to explain the related efforts required by manufacturing groups to provide sufficient flexibility on lead time and ordering quantity to channel groups. The practice of this paper not only can improve flexibility on lead-time and ordering quantity of manufacturing groups, but can lead manufacturing groups to cooperate with channel groups to obtain solid advantages by implementing CPFR.