Centralised grocery supply chain planning: improved exception management
International Journal of Physical Distribution & Logistics Management
ISSN: 0960-0035
Article publication date: 7 April 2015
Abstract
Purpose
The purpose of this paper is to present an operations model for retail replenishment collaboration and identifies its expected benefits and limitations for the members of a grocery supply chain.
Design/methodology/approach
A case study is conducted on a development project between a grocery wholesaler and two grocery product suppliers. Data are collected through semi-structured interviews with key respondents from four different companies.
Findings
Despite advances in collaborative practices in grocery supply chains, retail store replenishment management faces challenges. In particular, demand exceptions management is a challenge in the grocery industry. A replenishment model called Collaborative Buyer-Managed Forecasting (CBMF) creates a proactive planning approach and a platform for close collaboration in the supply chain. The centralised forecasting transforms retailer sales data into a plan which serves the whole supply chain by creating one-order forecast. The CBMF model facilitates efficient demand management, improves demand responsiveness and promotes better availability of products in retail stores.
Research limitations/implications
CBMF provides a replenishment planning model for the whole supply chain. It is tested to a limited extent in one supply chain.
Practical implications
The study provides managers with a better understanding of the benefits of centralised forecasting and closer replenishment collaboration, especially during periods of exceptional demand.
Originality/value
A new approach for managing demand in grocery supply chains with centralised forecasting is provided.
Keywords
Acknowledgements
The research presented in this paper is part of LogiNord-project – Sustainable logistics in Nordic fresh food supply chains. The authors of this paper graciously acknowledge the partial funding provided by NordForsk for the project.
Citation
Alftan, A., Kaipia, R., Loikkanen, L. and Spens, K. (2015), "Centralised grocery supply chain planning: improved exception management", International Journal of Physical Distribution & Logistics Management, Vol. 45 No. 3, pp. 237-259. https://doi.org/10.1108/IJPDLM-02-2014-0017
Publisher
:Emerald Group Publishing Limited
Copyright © 2015, Emerald Group Publishing Limited