The term efficient consumer resonance (EKR) or frequently also English Efficient Consumer Response (ECR) designates an initiative to the co-operation between manufacturers and dealers, which at cost expense and better satisfaction of consumer needs aims at. The Supply becomes chain, from which production examines up to the purchase decision of the consumers, on Optimierungspotenziale. A goal is the linkage of logistics-lateral Rationalisierungspotenzialen with Marktwachstumspotenzialen on sides of marketing. Potenziale can be uncovered and/or realized by co-operation between industry and trade, which would not be possible by an isolated internal view.

Reasons for ECR

The importance of Efficient Consumer Response regarding uncovering of rationalization and market growth potentials, shows up in the drastic developments at (European) the consumer goods market, which since beginning of the 1990er years carry out themselves. Among these ranks the saturation of the markets, which causes a decrease of the size of the market. Further competition is delivered particularly on level of the price. The result are price fights, which make substantial rationalization measures in logistics and personnel management necessary. Also the increased requirements of the consumers mark this development.

Description of the ECR concept

Efficient Consumer Response cannot be regarded as a completely new idea. Already for many years determined techniques of this concept are used such as co-operation between industry and trade or the organization by efficient distribution systems. The ECR concept contains however three substantial innovations:

• Standardisation: Past supply-chain-spreading opportunities for rationalisation were made more difficult particularly by non-uniform packing and/or packing carrier (e.g. pallets), different software and differences in the tag. The creation of standards by the ECR concept, makes now a rapid co-operation possible, which form the foundation-stone for rationalization measures.

• Rationalization and market growth: The ECR concept makes a connection between rationalization measures and measures to the realization of market growth potentials contrary to past co-operation.

• : Past co-operation were limited to the bilateral level, while the Efficient Consumer Response was based on a multilateral co-operation idea.

Creation of uniform standards

As previously mentioned, Efficient Consumer Response aims off at the optimization of the entire supplying chain. For this it is first necessary to create uniform standards. These concern the following ranges:

• Efficient unit Loads (EUL), "“efficient goods bundling"”: Here it concerns the uniform organization from transportation packing and packing carriers.

• European Article NUMBER (EAN), "“European article number"”: It serves the identification of products.

• Electronics DATA interCHANGE (EDI), "“electronic data exchange"”: Paperless and electronic exchange of data such as orders, calculations or delivery notes between enterprises.

Components of the ECR concept

On basis of these standards the processes of the supplying chain can be accomplished more efficiently. Regarding these processes can between:

• logistics-coined/shaped and/or offer-lateral processes, which in the so-called "“Efficient Replenishment"” and
• marketing-coined/shaped and/or after-questioner-lateral processes, are summarized which in the so-called "“Category management"”,

are differentiated. Both the "“Efficient Replenishent"” and the "“Category management"” are to be described now more near:

• Efficient Replenishment (IT) (dt. "“Efficient Warenversorgung"”): A goal is it to develop an efficient distribution system to arrange i.e. the goods supply efficient. Production is steered on the basis the demand of the customers at the selling and place. The customer is to be supplied at the correct place at the right time with the correct product in the correct quantity and quality. To arrange by so-called electronics DATA interCHANGE (EDI) tries the information flow as efficient as possible.

The optimization of the delivery chain by Efficient Replenishment made possible further a faster reaction to changes of the market as well as better extent of utilization of transportation resources.

A special form of the "“efficient Warenversorgung"” represents the Continuous Replenishment (continuous Warenversorgung). The manufacturer is integrated into the planning of the orders and the supplies, by receiving constantly current information such as stock and Abverkaufsdaten from the dealer. Thus cost-intensive stocks and delivery costs can reduced, as well as the goods availability to be improved.

A further form of the Efficient Replenishment is the CROSS docking. Among them one understands a process within a logistic chain, by which the process of storing and/or is void. This becomes possible by temporal and quantitative co-ordination between delivery to a CROSS Docking point (for example the central storage depot of a dealer) and distribution to the receiver.

• Category management (cm) (dt. "“Category of commodities management"”): Category management is the after-questioner-lateral dimension of the Efficient Consumer Response

In the following are beside the Category management, now further inquire-lateral Basisstategien and/or components is described.

• Efficient Product Introduction (EPI) (dt. efficient product introduction): Thus the success rate is to be lifted by (again) product introductions by co-operation between dealers and manufacturers, and/or which are lowered "“Flop rate"”. Co-operation carries out itself both within the ranges of the product development and the product introduction.

• Efficient net curtain Assortement (ESA) (dt. efficient assortment organization on branch level): To reach tried by inventory and shelf optimization a higher productivity of the sales area as well as a higher turnover rate of the goods.

• Efficient graduation (EP) (dt. efficient sales promotion): Activities of the sales promotion between manufacturers and dealers are to be co-ordinated. A goal is it to reduce the costs of paragraph-promoting measures.

Advantages

• Delivery time as well as higher security of the supply, since prognoses become by the ECR simpler and more exact
• Reduction of the costs of transport and packing, since goods can be arranged more efficiently
• Lowering of the rate of false supplies and thus the error subsequent costs
• Improved information flow within the logistics chain reduces the consequence lungs of the whip effect (Bullwhip Effect)
• Salespromoting measures can be better planned
• Customer satisfaction
• For consumers: higher availability of the products, better price/achievement relationship and freshness of the goods

Disadvantages

• Soft and hardware systems for the establishment of the ECR caused high capital outlays
• Large tuning expenditure
• Disclosure of information like for example scanner data
• Danger of the abuse of data
• Willing to cooperate shank and qualification of all involved ones necessarily
• Shift of power between trade and industry

Practical examples

• Co-operation between ADEG Austria commercial corporation and Unilever Austria GmbH Ice Cream & Frozen Food: These enterprises could achieve a strong lowering of shelf gaps (of 9,1 on under 4%) by a enterprise-spreading process optimization with special consideration that consumer needs. Shelf gaps result from the absence of articles in the shelf. Smaller conversions as well as negative effects on the competition of the dealer and the manufacturer, can be the result.

• SAVE Austrian ones trade-say: This enterprise could improve its yield by ECR substantially. This was reached by inventory lowerings as well as the increase of the minimum durability by articles in the shelf. The costs of the storage could be reduced by the lowering of the existence. This cost saving is passed on to the consumer in the form of lower selling prices. By the increase the customer profits to the minimum durability particularly from the freshness of the products.

• Further enterprises, which use the ECR concept successfully are: Handles wash and cleaning agent GmbH, of products GmbH, Ikea, u.v.m.

See also

CPFR, Quick Response, Continuous Replenishment, Category management

Articles in category "Efficient Consumer Response"

We found here 5 articles.

Related Websites

We found here 4 related websites.

• ECRnet
  ECR Europe - Efficient Consumer Response.


• FMI Media Backgrounder - Efficient Consumer Response
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• Food Marketing Institute - Supply Chain
  ECR: Efficient Consumer Response. ECR is a grocery industry strategy that was created in January 1993 in which distributors and suppliers are working ...


• Grocery Manufacturers Association | Industry Affairs | Efficient ...
  To study ways to provide even greater value to consumers, industry leaders formed the Efficient Consumer Response Working Group in mid-1992. ...