Accurate, timely sales data and reliable forecasting capabilities are key ingredients of any continuous replenishment program.
However, the degree to which retailers are willing to share movement, promotion and pricing information with vendors managing their inventories varies across the board.
A recent industry survey conducted on behalf of the Joint Industry Project on Efficient Consumer Response found that 70% of retailers involved in continuous replenishment electronically transmit warehouse shipment and inventory data to their CRP supplier partners daily.
By contrast, fewer retailers are sharing sales forecasts (18%) and promotion plans (26%) on a weekly or more frequent basis, according to the survey conducted by Kurt Salmon Associates, New York.
"It's not unusual for people who have all their lives protected their sales data to be reluctant to share it with a supplier, [especially those] with whom they may have had rocky relations," said David Jenkins, director at J. Sainsbury, London. "But it's likely that as we work together in the category management area with common objectives -- satisfying the customer better -- some of those trust elements will go away."
Trust issues may have hampered development of continuous replenishment somewhat, industry observers said, but entering into such a partnership doesn't require full disclosure that compromises competitive strategies.
"I think there should be a sharing of information so you can work together," said Nick Ciaccio, vice president of logistics at Dominick's Finer Foods, Northlake, Ill.
"There still is information that you can hold back, which we do, like the sales we're going to be putting on. But as far as sharing the movement, when an ad is going to run, the strategy behind a category -- I think that's something we need the manufacturer's help with also.
"We have our own good information, but [manufacturers] have good marketing information, demographic information, a profile of their brands and the customer that will use that type of item," he added. "It all ties in with category management."
