Motorola - Collaborative Planning, Forecasting and Replenishment

What is CPFR?

: Collaborative Planning, Forecasting and Replenishment

CPFR is the sharing of forecasts and related business information among business partners in the supply chain to enable automatic product replenishment.

What it does: CPFR is designed to improve the flow of goods from the raw material suppliers, to the manufacturer, to the retailers' shelves. It also is designed to quickly identify any discrepancies in the forecasts, inventory, and ordering data so that the problems can be corrected before they negatively impact sales or profits.

How it works: You share your sales history, sales projections and other important information with your business partners, and they in turn share their raw material availability, lead times and other important information with you. Then the information is integrated, synchronized, and used to eliminate excess inventory and improve in-stock positions making everyone in the supply chain more profitable

Motorola’s case

Like most leading makers of mobile phone handsets, Motorola, Inc. understands customer segmentation very well. Managers in Motorola's Mobile Devices business know that the technology-savvy consumer will not buy the same handset as the fashionista or the everyday communicator, so the company offers over 120 models globally.

The difficulty comes in knowing how many of which models to make and sell. Accurate replenishment