Cost/Profit and Value Measurement

Use of the technologies needed to permit efficient and effective communication of product, replenishment and business data between trading partners - including enablers like EDI, EFT, Product & Shipment Identification, Master Data Alignment and Electronic Communication Standards like Internet and Intranet.
 

Activity Based Costing is an accounting methodology which assigns costs to items on the basis of the activity that they incur. Activities are seen as the primary cause of cost instead of focusing traditionally on products or services. This new way of working within ECR will not only reduce the total costs of the supply chain but will also shift the balance of costs.	When related to Demand Management, activity based costing enables allocation of costs to categories for costs such as logistics, product development or promotions. The scorecard measures the level of ABC application within the firm and jointly with trading partners.
Consumer Value Measurement is a measurement framework that links value delivered to consumers to value receive from consumers. This framework includes five critical steps and their corresponding sets of information, linked together under three measurement processes: The outer ring (business objective & plans linked with value delivered to shareholders) is the business planning process currently used by companies, including traditional accounting methods;	The inner ring (commercial plans & actions linked with value received from consumers) is the process used to define and manage commercial actions, including all of the indicators and methods recommended in this report for estimating and measuring the value received from consumers; The centre box is the process used by the company to understand the wishes of consumers and their perception of how well products and/or channels fulfill these wishes, including all of the indicators and methods that are recommended in this report for estimating and measuring value delivered to consumers.