Decreasing in The Inventory Levels to Reduce Variable Costs
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Decreasing in The Inventory Levels to Reduce Variable Costs
Benefits of CPFR Until now, most CPFR initiatives focused on reducing variable costs, such as decreasing inventory levels. However, there are further benefits to be gained for companies that integrate CPFR into their standard operational procedure and scale to critical mass (see Figure 4.11).
Decreasing in The Inventory Levels to Reduce Variable Costs
MM Reduce capital investment Companies reaching critical mass with their CPFR initiatives may also harvest additional benefits from a reduction in capital investment. Reducing warehousing capacity is possible for the
collaboration partners in the long term through the increased supply chain visibility and a reduction in uncertainty. Increased forecast accuracy alongside collaborative long-term planning reduces the need to build up
inventories or production capacity to cover unexpected changes in demand.
Reduce capital
invested
Optimise production
Reduce storage capacity
- Higher utilisation of production capacity • Greater supply chain visibility allows inventory and storage capacity reduction
Increase revenue
Better availability
Improved consumer
satisfaction
- Reduced out-of-stocks • Improved consumer satisfaction ratings
Decrease costs
Benefits
Wastage
Inventory
Transportation cost
Overtime
- 20–25% reduction inventory carrying cost • Improved forecast accuracy • 50% reduction in unplanned overtime • Up to 500% ROI on promotions • Reduced excess and obsolete inventory • Reduction in lead time
Figure 4.11
Just as some books are preserved and regarded as having had obvious effects on society (such as Lolita, Lord of the Flies, and Orwell’s Animal Farm and 1984), there have been a number of films that we look back upon
which have clearly had cultural resonance, or became part of a social dialogue we’re perhaps still engaged with today (see Figure 9.1 of the text). Our text tells us that “the impact of these movies is mostly unintentional”
and that there is debate about whether the movies caused a societal shift, or if a change in the culture caused the movie to be created (see page 262).
The text also says that the exact nature of this exchange “is up to you to decide.” For this Discussion, please provide detailed examples of at least two films you have seen that you feel have either influenced society, or were
directly influenced from an event that we collectively experienced.
Keep in mind that some of the films listed are documentaries, and have different structures and intentions than a typical narrative film.
Decreasing in The Inventory Levels to Reduce Variable Costs
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