CRA Retail Supply Chain & Replenishment 3

Question 1

In demand planning, a 'cannibalization effect' occurs when:

Accepted Answer

A new SKU steals sales from an existing SKU in the same category

Answer

Cannibalization happens when a newly introduced product draws sales away from an existing product within the same retailer's assortment.

Question 2

A grocery retailer uses continuous replenishment planning (CRP). What data does the retailer typically share with its supplier to enable this?

Accepted Answer

Point-of-sale data and current inventory levels

Answer

CRP relies on the retailer sharing real-time or near-real-time POS and inventory data so the supplier can automatically generate replenishment orders.

Question 3

Which term describes the practice of positioning inventory closer to end customers to reduce delivery lead times?

Accepted Answer

Forward deployment

Answer

Forward deployment places inventory at regional DCs or forward stocking locations nearer to customers, cutting last-mile delivery time.

Question 4

A retailer calculates its weeks of supply (WOS) as 8, but the industry standard for that category is 4. What does this most likely indicate?

Accepted Answer

The retailer may be overstocked, tying up excess capital

Answer

A WOS of 8 versus a standard of 4 suggests twice the normal inventory on hand, indicating potential overstock and excess working capital tied up.

Question 5

A retailer adopts a 'pull' replenishment system rather than a 'push' system. What is the key distinguishing characteristic?

Accepted Answer

Replenishment is triggered by actual consumer demand signals at store level

Answer

A pull system replenishes only what has been consumed, driven by real demand signals, reducing overstock and waste.

(CRA) Certified Retail Analyst Practice Test

(CRA) Certified Retail Analyst Practice Test

CRA Retail Supply Chain & Replenishment 3