ECR - Efficient Consumer Response Australiasia

Objectives

The objectives of ECR Australasia flow from the adoption of a broader mission to both take costs out of the supply chain and better satisfy consumer demands.  They include:

• to deliver benefits to grocery industry trading partners by working together to better meet consumer needs and add consumer value through the establishment of standard industry practices and the development of successful business approaches;
• to educate industry participants about the benefits of ECR, through pilots, case studies, seminars and reports
• to liaise with other industries and organisations, both in Australasia and overseas, to ensure common solutions to common problems and;
• to take account of global and international standards.

Inherent in the objectives of ECR Australasia is a requirement to complete projects and deliver outcomes quickly to ensure that Australian and New Zealand grocery industry partners remain abreast of international best practice.

Structure

A joint industry body, known as ECR Australasia, and responsible to the Boards of the AFGC, NZFGC and Australian and New Zealand retailers.  It is located within the AFGC for administrative convenience and not set up as a separate legal entity with its own corporate membership base as in many European countries.  Member companies of all supporting organisations are eligible to participate in input to, and access the outputs of, ECR Australasia.

ECR Australasia is controlled by a Board of high level industry executives (desirably CEO's), chaired by the Chairman of the AFGC Supply Chain Committee, or designate, and comprising representatives of Australian and New Zealand suppliers,  retailers and wholesalers. The Board will from time to time review its representation to determine the appropriateness and ensure it is representative of the current market and industry sectors.    

Service providers are not included on the Board as it is considered they are most appropriately involved at working group level.

Work Program

The Board of ECR Australasia follows the established criteria for determining the work program and priorities to achieve value enhancing outcomes for the industry.  Criteria include:

• contribute to the prompt completion of existing projects
• can be tested for practicality at an early stage
• are deliverable to the grocery industry
• are valuable in terms of creating common systems/mechanisms/language/building blocks
• yield significant consumer benefit in concert with acceptable financial returns from cost savings, sales and profit increases.
• can take up overseas knowledge for ready application in Australia
• can be effectively communicated to the industry.

It should be necessary only to adapt overseas material for application in Australia and New Zealand, not ‘reinvent the wheel’, to establish common bases for industry standardisation of the next steps towards enhanced consumer value.

ECR can be implemented in small projects over time, but is intended to be addressed as an integrated whole and assessed in terms of impact across the entire supply chain.

Funding

The administration costs for operating ECR Australasia are covered through the Australian Food and Grocery Council. An operating cost statement will be provided by the Secretariat at each Board meeting and these costs will be discussed periodically. Project costs, other than those incurred by participants and usually for the publication of a guide or report, will be determined by the project team and ratified by the Board. 

Communication and Education

A key element of ECR Australasia is the education of ECR principles and benefits throughout the industry. Communication and education should strive to effect broad scale change in business relationship management and behaviour across the consumer goods industry. ECR Australasia communications should;

• promote collaboration between retailers and suppliers in order to ensure profitable growth and consumer retention.
• develop frameworks that allow the rapid rollout of ECR best practices
• promote ECR Australasia.

Operating Principles

Operating principles are based on ECR practice and form the basis for work activity, education and communication. Specific reference to these principles will be outlined in project briefs and where appropriate. They act as a practical framework for trading partners committed to implementing ECR Practices.

Competition

ECR is designed to serve the interest of the consumer. ECR practice can not be used to restrict competition between retailers or suppliers. Companies undertaking ECR projects should apply ECR practice in strict compliance with applicable competition laws. In particular they should ensure that:

• no sensitive information should be exchanged between competitors,
• all information exchange between trading partners should happen in strict accordance with the applicable competition laws; and  
• along the supply chain itself, parties should not enter into agreements that restrict the other party in its freedom to choose trading partners, make supply chain channel choices, decide product assortments, or otherwise manage sales to consumers or other customers.