CPFR essence and purpose

CPFR is a trade initiative supported by the Voluntary Inter-industry Commerce Standards Association (VICS). CPFR was created in the mid-1990s to support the synchronisation of forecasting and planning between retailers and manufacturers. The integrative nature of this 

agreement on collaboration terms in line with CPFR terms (e.g. defining the roles of participating companies, appointing people responsible for process implementation, clarifying desired standards of efficiency and effectiveness, and determining acceptable deviations between the forecasts and plans of individual supply chain links)  

development of common plans for each product category, taking into account promotion schedules and inventory management principles  

operational cooperation in terms of production, inventory replenishment and sales consisting in (Witkowski 2001, p. 605)  

The CPFR concept helps improve inter-organisation collaboration through joint administration of information and collaborative process management aimed at reaching mutual benefits for business partners. The most important positive implications of CPFR in favour of its application in the supply chain excellence are presented in Table 2.2. 

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