Barilla Case Study

If we look into Starbucks coffee, we want to investigate that which way they perform better as a company whether or not it will continues to perform. In order to check this

In order to address such problem, the company may opt to offer discounts in certain time of the day to boost the sales of its bread. For instance the bakeshop may provide 50% discount on its baked goods when stores are about to close. In doing so, it will not only reduce the spoilage of the bakeshop, but would also broaden the appeal of the bakery-café to a bigger market. The discount serves as a tool to segment the market that the company is catering into, and thus be able to maximize the sales per target market.

Define the Problem: Describe the type of case and what problem(s) or issue(s) should be the focus for

Barilla, the leading pasta manufacturer in Italy, faces increasing problems related to demand fluctuation. Their distributors also suffer from high inventory holding costs and low service levels on the other hand. This report explains, why the company and their distributors are troubled with this situation and how Barilla intends to solve it. The problem Barilla experiences is called the “Bullwhip Effect”, i.e. that demand variability increases when moving up the supply chain. Several factors enforce this Bullwhip Effect, e.g. high lead times, poor demand forecasting, and batch ordering. In this report we will point out, that exactly those aspects can be identified as the underlying reasons for Barilla’s problems. In a

In the effort of keeping with the extremely unpredictable demand the production cost may rise dramatically as a result of diseconomies of scale. In addition the set up cost for producing different products in the production line is heavy and Barilla has an enormous product line of different products. The production plant in Pedrignano is big and technologically advanced but at the same time the pasta production is a complicated process and especially the drying of different types of pasta required precision in temperature and humidity levels that could not be changed

4) Exploring the possibility of implementing JIT (Just in Time) system that can reduce the finished goods inventory at

Recommendation:1. Improve Just-in-time systemSpartan Plastic Limited need to improve Just-in-time system, it is control aims to maintain inventory level at zero, with an immediate objective of reducing the capital tied to the inventories. It is an important principle that able to eliminating waste throughout the production system. The waste can occur, through excess inventories and overly large lot sizes, both of which can cause unnecessarily long customer lead times. Let's explain the role of the core JIT practices in enhancing manufacturing performance. JIT manufacturing requires the establishment of JIT supplier relationships with suppliers; Spartan in this case, that is able and willing to deliver the needed quantities of parts as the needs arise and without any defects.

Barilla’s products are divided into Fresh products and Dry products. The demand for these two distinct kinds of products is quite different, and the order, shipment and delivery methods for them are also various.

Because of the way Barilla’s manufacturing process works, demand fluctuations have a significant impact on the company’s operations. Tight heat and humidity specifications in factory tunnel kilns require very specific sequences of pasta production, which means Barilla has limited flexibility in ramping up (or ramping down) the production of pastas experiencing unexpected demand levels. Furthermore, because of extremely high holding costs, it is simply not economically viable for Barilla to maintain substantial finished goods inventories to guarantee fulfilling distributors’ fluctuating order quantities.

The SWOT analysis is business analysis method that business can use for each of its department when deciding on the most perfect way to increase their business and future growth. This procedure identifies the internal and external strengths, weaknesses, opportunities and threats that are in the markets.

A common way of decreasing the amount of inventory a business holds on a daily basis is implementing a just-in-time inventory process. A Just-In-Time inventory system means that the business gets the materials for a product, as they are demanded. “The electronic data

The objective of a firm confident with the strength and durability of its competitive advantage and internal resources is to export its business in markets where the potentiality of the benefits arising from the business strategy are not exploited fully or at all. A logical path of growth for a firm follows the Entrepreneurial, Organizational, Corporate, and International phase (Giarratana, 2016). Barilla definitely developed to the latter stage around the 1970’s, when Grace saw the opportunity of exploiting this potential final growth of the Italian group. The failure by the American management and ownership did not mean that the concepts were wrong. Actually, Pietro foresaw the opportunity of taking back Barilla and

Just-in-time delivery needs good collaboration with vendors of distribution services and of products. The distributor needs a continuity of demand and the chance to define routes, loads and schedules well ahead. By working toward longer-terms, higher-volume procurements with vendors, prices can be cut due to larger transport volume over a long period of time. Just-in-time delivery will cut down the operating costs if the business is substantial for the distribution partner. Just in time delivery needs more frequent deliveries from vendors however it does not voluntarily imply higher transportation costs.

There more management methods of inventory of how to optimize inventory. Dell uses already the Just-In-Time inventory. If the optimization of the JIT processes should be done then “the whole supply chain” has to be observed. The dependency form supply get higher and the shortages problems can happen. As the result would be a disappointed

According to [5], Just-in-Time (JIT) inventory management enables an organization to gain competitive advantage by not having a large or excessive amount of inventory in warehouse. The organization only needs to order the parts when they are actually needed and new materials are produced only when old materials have finished. One advantage of adopting this strategy is that there will be no excess of inventory that needs to be stored and hence the inventory levels will be reduced as well as the cost of carrying and storing goods. One major disadvantage of this is that the organization will expose it in the risk of ordering problems for example a supplier is not able to provide parts on time. The result of this is that the organization cannot fulfill the order and contributes to customer dissatisfaction.