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Must-Wins for 2022: Effective Retailer-CPG Collaboration to Escape Today’s Supply Chain Disruption

Dec 14, 2021 2 min

RELEX Solutions will offer several presentations at NRF 2022 on improving meaningful collaboration between retailers and the CPG companies in their supplier networks. RELEX will present on this subject at Booth #5553 at 10 a.m., noon, and 2 p.m. on Monday, January 17.

Why Is Retailer-CPG Collaboration a Must-Win for 2022?

“My motto has always been that retailers and suppliers have one supply chain, and we succeed or fail together. By sharing our forecasts with our suppliers, everyone benefits through better transparency and communication, improved ordering processes, and reduced waste.”

 Andreas Persson, Head of Replenishment at ICA, Sweden’s leading grocery retailer.

With supply chain disruption making front-page news around the world, both retailers and CPGs face an urgent need to break out of the dreaded “bullwhip effect.” Today’s supply chain disruption is the result of many factors including shipping challenges, labor shortages, and distorted demand signals from two consecutive years of COVID-impacted sales. These factors are exacerbated by inaccurate demand forecasting and a heavy reliance on historical data that fails to capture shifting needs, leading to a widespread lack of visibility into actual end-demand.

For CPG companies, this results in dangerous levels of uncertainty in production and distribution plans, whereas retail companies can face low availability and long waits for products from suppliers, then potentially excess inventory from over-ordering, leading to high waste levels and insufficient capacity.

How Retailer-Supplier Collaboration Helps CPGs and Retailers Escape the Bullwhip

In 2022, retailers and CPGs must focus on improving supply chain visibility through more effective collaboration. Truly effective retailer-supplier collaboration relies on a foundation of four key activities:

  1. The automation of two-way data sharing
  2. AI-driven analytics for planners to proactively identify and resolve unexpected variations such as exceptional retailer order projections or supplier forecasts
  3. Joint meetings for collaborative short- and long-term demand and supply planning
  4. The ability to jointly monitor performance to iterate planning cycles and learnings

To execute these activities, CPGs and retailers need to collaborate within a secure portal that enables them to access shared data and automatically identify planning discrepancies before they impact either party. A collaboration portal also provides a basis of which CPGs and retailers can run collaboration meetings to view and adjust commercial plans, like promotions and new product introductions.  Similarly, planners for both CPGs and retailers should be able to adjust forecasts and plans to any level of aggregation to inform their final plans before anyone suffers a negative impact.

Who, Where, and When:
Date: Monday, January 17, 2022
Times: 10 a.m., noon, and 2 p.m. EST
Location: Booth #5553