ECR – Efficient Consumer Response

ECR, Efficient Consumer Response, looks at the informal supply chain from the manufacturer to the point of sale from the perspective of consumer needs and maximum customer benefit. ECR cooperation is used to ensure that all companies involved benefit from the analysis and evaluation of the collected findings (information). It is mandatory for all companies involved in the supply chain – if agreed in the network.

In this way, conclusive information is used to reduce expenses and costs to a minimum during the production of goods, transportation of goods, storage of goods and the actual management of goods. For example, the following are taken into account: Sales forecasts, trend effects, seasonal effects, sales planning and market activities. They are transported from the retailer to the manufacturer, who analyzes this information and consequently controls production in such a way that resources are conserved in advance. Such analyses are also used to avoid the bullwhip effect, for example.

ECR as an information flow

ECR therefore describes the entire flow of information from production to the warehouse to the retailer. In some classes of goods (textile industry), even the customer himself is included in the information flow. This contrasts with the notification of goods. In this case, the information, or notification for short, is sent electronically to the recipient (distribution center) in advance as an announcement of a pick-up or delivery – all other participants in the supply chain are left out.

Important: The use of an integrated information and communication system to ensure paperless data exchange using EDI and the free availability of point-of-sale data are prerequisites for a comprehensive reorganization of the logistics system within the framework of ECR. Dr. Kai Riemer, Westfälische Wilhelms-Universität Münster, ERCIS European Research Center for Information Systems, Chair of WI and Interorganizational Systems

Further information on the flow of information in the supply chain can be found under“What requirements an APS system must fulfill – Part I“.

Image source: © Julien Eichinger – Fotolia