The New Digital Strategy ; A Leader in ECR Implementation
In the year 2000, the internet was emerging as a new distribution channel that would transform the grocery industry by providing a powerful communications network for the direct sale of groceries to the consumer. The internet was also a promising tool for the way that business to business transactions would take place. There were new opportunities to gain efficiencies in the supply chain and in the distribution channels. Given that the grocery industry is extremely competitive, Fully Clingman the president and CEO of H.E.B. Grocery Company are placing renewed emphasis on technology and new systems to gain greater market share …show more content…
Efficient Consumer Response (ECR) - A demand driven replenishment system designed to link all parties in the logistics channel to create a massive flow-through distribution network. Replenishment is based upon consumer demand and point of sale information. HEB became a leader in ECR implementation. Their company performance jumped from 13th to 10th in the industry. They implemented (CM) category management, this system allowed HEB to monitor and manage their inventory in categories. They gained strength in their (CRP systems) continuous replenishment of products systems that allowed them to constantly restock products or add shipments to ensure that they never run out of fast moving items. They were able to increase their scanner accuracy through the use of new scanner technology to (99.8%). HEB also performed continual basket analysis, an analysis of which products consumers were buying to find trends and data amongst a key basket of goods. This would allow HEB to better understand buying behaviors. With the data collected from analyses and systems, they shared the information freely with cooperative suppliers. This helped with supplier relationships and solidified their trust in HEB. Being a leader in ECR technology has paid off HEB giving them sustainable competitive advantages and has allowed them to gain market share in such a fierce industry.
(A) The New Digital