West Marine is looking to drive growth through improving its supply chain management. It recently acquired E&B Marine and is now working to integrate E&B's business, which faces several challenges including differences in supplier relationships, product assortments, and pricing. West Marine is considering either keeping the two brands separate through dual branding or fully merging them. Collaborative planning, forecasting, and replenishment (CPFR) with suppliers could help with integration by establishing shared forecasts and replenishment processes. Internal collaboration between merchandising, planning, and replenishment teams also needs improvement to better coordinate decisions that impact inventory performance. The presentation outlines West Marine's approach to CPFR and gaining supplier buy-in,

1. West Marine: Driving Growth
Through Shipshape Supply Chain
Management
CASE ANALYSIS
Presented By:
Ashish Mehta (11BM60079)
Manish Gupta (11BM60100)
Harpreet Kaur (11BM60111)
Harsh Kr. Srivastava (11BM60122)

2. Challenges
 Boat US has same number of stores as E&B Marine
 Integration of business difficult because of growing catalog and
wholesale business
 Boat US port supply division is less mature
 Customer base not clearly defined for Boat US
 Boat US home staff is not being acquired so limited info and
assistance from legacy system
 Only 10k common SKU
 750 suppliers with only 100 common.
 Both use EDI but 30% of transactions of Boat US are integrated
 Boat US does not have CPFR
 Pricing is different because of different suppliers
 Product assortments are less well defined for Boat US

3. Current Options
 Supplier integration through CPFR
 Internal as well as external integration is needed to
succeed.
 Two strategies are possible
 Dual branding strategy
 Merger of two brands

4. CPFR
 Single Shared forecast for all trading partners
 Point-of-sale data used for forecasting.
 Minimization of Bullwhip effect
 Joint & mutual replenishment activities
 Clear performance measures set.
 Risks are monetized to show clear financial
consequences.
 Incentives to drive the collaborative effort.
 Gains by its application in the E&B case.

5. Strengths
 CPFR experience from previous merger has to be
leveraged in Boat US merger
 Bar code and RFID is available
 Boat US warehouse management systems
comparable with West Marine but not directly
compatible
 Hardware is same as West Marine but software is
different

6. The Right Replenishment System
 Data such as seasonal forecasts, promotion stock levels, and future
assortment changes are automatically calculated so that the retailer
gets a reliable projection of its future orders and so that suppliers can
continually deliver accurate, on-time orders to the DCs
 The resulting order forecast is in the form of machine-readable data
that can be entered into a supplier’s materials requirement planning
(MRP) or enterprise resource planning (ERP) system to represent a
key customer’s demand.
 The store system uses actual customer-purchase data to forecast
future customer purchases and what the store needs to order to
support retail-service levels and in-stock levels. But the warehouse
system has no data about store-level overstocks or understocks, and
promotional needs must be forecasted in both platforms.

7. The Right Replenishment System
Cont…
 Reports to its collaborative supplier teams
 weekly automated e-mail containing our current purchase forecast by
item and week for a year
 a weekly automated e-mail containing key in-stock and late-shipping
information, covering the metrics achieved and the items that failed to
meet goals
 a monthly automated e-mail giving audit-level detail and performance
measurement on each supplier’s shipping record based on the supplier’s
advanced ship notices.

8. Multiple Routes to Supplier Buy-In
 Prior to the CPFR program, the only contact a supplier might
have with West Marine was usually with a customer-service
clerk. Today, all collaborative suppliers join monthly and
quarterly meetings
 Encourage the “point people” on both sides to be powerful
collaboration champions in their respective organizations
 West Marine adopted cross-functional management and
accountability and they adopt team approaches to conducting
supply chain activities. They also start to harmonize conflicting
“silo” goals and metrics throughout their operations.

9. Multiple Routes to Supplier Buy-In
Cont…
 An engagement usually begins with a quarterly meeting.
 The quarterly meetings are held at West Marine’s offices or at the
supplier’s location; they usually entail a half day devoted to supply
chain collaboration and a half day devoted to sales and marketing
planning.
 The supply chain portion includes a session on West Marine’s
bottom-up forecasting process and a wide-ranging discussion of
initiatives and opportunities. The initiatives are detailed by West
Marine’s supply chain captains, who must manage the solution
process and timeline.
 Since senior executives are present, each side is expected to commit to
resources and timelines for the improvements identified. They don’t
advocate a formal collaboration agreement, but they do expect a
flexible commitment to their mutual success from both sides.

10. Multiple Routes to Supplier Buy-In
Cont…
 As with the quarterly meetings, the “routine” or monthly meetings
have defined formats and expectations. The format is usually a
conference call attended at least by the two partners—West Marine’s
supply chain captain and suppliers.
 The meeting is usually kept short to make it efficient and effective and
to encourage other key participants to attend, since they can expect
the meeting will be concise, businesslike, and productive.
 The agenda is three-part:
 Review results ;
 Report on and manage current initiatives by assigning clear
owners, accountabilities, and deliverable dates; and
 Resolve any supply chain constraints identified through review of
the order forecast.

11. Internal Collaboration
 Category managers and their assistants operated primarily as sole
practitioners.
 Merchandise planners and replenishment analysts often dealt with
supply chain management as a downstream effort. Communication
between the co-located teams was often pretty poor.
 Merchandising associates owned sales and margin.
 Replenishment associates were responsible for inventory and
service levels. Yet many of the specific responsibilities were ill-
defined and inconsistent.
 For instance, since initial product forecasts and store assortment
decisions were the purview of category management, some of the
most important determinants of inventory performance were not
the job of the inventory management group.
 Internal collaboration is all the more important because Boat US
Employees are not being merged.

12. 10 performance-improvement steps to
reflect “full strength” approach to CPFR
1. Seek long-term, holistic solutions, not quick or myopic fixes.
2. Reconcile conflicting goals and metrics.
3. Pursue inclusive problem-solving; do not depend upon
“experts” who don’t have accountability for the business.
4. Instill collaborative processes that encourage idea creation,
shared problem solving, and high adoption rates across
organizational boundaries.
5. Use a disciplined and iterative set of methodologies such as
CPFR, SCOR, or Six Sigma to help teams define issues, root
causes, and solutions.

13. 10 performance-improvement steps to
reflect “full strength” approach to CPFR
Cont...
6. Develop a culture of continuous improvement, particularly at
the customer-facing associate level, because those employees
are most likely to know what’s needed.
7. Create clear accountabilities and assign authority with a focus
on core business processes rather than on traditional
organizational “silos” or loyalties.
8. Commit to technology enablement for execution,
communication, exception management, and root-cause
analysis.
9. Reduce decision cycle times.
10. Implement rapidly.

14. Thank You