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Fundamental to long term relationships is the process of information sharing between actors in the supply chain - often termed collaboration.

Collaboration adds value when retailer and supplier are working together towards a common goal - it doesn't work if there is a power struggle and one or other party uses a balance of power in negotiations.

Processes ideally enhanced by collaboration include product development and selection and aspects of merchandise / range planning.

Detailed demand forecasting can be done collaboratively when the retailer shares sku-store-day level customer demand data with the suppliers and the supplier does the forecasting and replenishment to DC on the retailers behalf. This is known as CPFR - collaborative planning, forecasting and replenishment - it is not unlike VMI - vendor managed inventory, however, there needs to be a very strong relationship between the parties before most will go that far. Sharing sales data does however happen quite widely between suppliers and retailers and from the point of view of the supplier any information about sale / stock / demand / promotional effectiveness is better than none at all when it comes to planning their own supply chains.

In many retailers supplier collaboration is something of a new concept. Many are still cautious about sharing sensitive sales data, and rightly so, with fierce competition a bit of healthy paranoia about confidential data getting into the public domain makes a lot of sense! More and more retailers are today realising the benefits of working more in partnership with their suppliers. The days of adversarial relationships and retailers being known as the "bullies" at the top of the supply chain are disappearing. It is still true that many retailers have the balance of power over the supplier base, but it is also true that buyers and procurement professionals have "grown up" and now believe that quality and reliability in the supply base is a more valuable asset than the current lowest price. This shift in mindset has lead to the realisation that building long term relationships with suppliers, large and small, pays off when excellent products are developed that almost intuitively meet the buyer's brief. Supply chains are flexible, demand patterns are understood and deliveries are, more often than not, complete and on time.

Whilst it is fair to say collaboration is primarily about relationships the information flow in support of a collaborative relationship is critical to achieving the goals. This is further complicated with time differences and vast distances between buyer and manufacturer. To aid the collaborative process methods by which highly sensitive data can be shared, safely, need to be used.