7/12/05

Metro Group uses CPFR to cut end-of-promotion stocks by 49%

Using CPFR to communicate with suppliers over the Internet, Germany-based retailer Metro Group has nearly cut in half the number of days promotion items sit on store shelves, the retailer said today.

Kurt Peters , Executive Editor

Using CPFR to communicate with suppliers over the Internet, Germany-based retailer Metro Group has nearly cut in half the number of days promotion items sit on store shelves, the retailer said today.

Metro, a diversified retailer, attributed the improvement to a collaborative planning, fulfillment and replenishment project it launched in 2002 in its Cash and Carry grocery stores. Products included in the CPFR program, which Metro runs through GlobalNetXchange, had an average promotional program shelf life of 18.9 days during the fourth quarter of 2004, compared to 37.3 days in early 2002 for products not included under CPFR, Metro said.

Axel Hopp, Metro’s corporate information manager, attributed the 49% improvement in shelf life to the more effective CPFR-based replenishment system, through which Metro collaborates with suppliers on demand and production forecasts.

Metro also said that delivery of promotional stock levels rose 4.85% under the CPFR program, to 99.53% from 94.68%. In a May 2005 article in Internet Retailer about its CPFR program, Hopp said that even small increases in stock levels can have a significant impact on profits and customer satisfaction.

Topics:

Data analysis, Forecasting, Online shopping, Psychology, Time series analysis

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