Barilla Pasta

1449 Words Jun 16th, 2018 6 Pages
Introduction In 1875, Pietro Barilla founded Barilla SpA, a small pasta shop in Parma, Italy. Barilla is a family owned company that has been passed down from generation to generation and has become a vertically integrated organization, with many bakeries and factories throughout Italy. For many years, the pasta shop experienced significant growth because of the high quality products that were marketed and produced in their facilities. In fact, during the 1980’s, Barilla experienced a 21 percent increase in growth. Within 10 years, Barilla became the largest pasta manufacturer in Italy. Barilla manufactured 35 percent of the pasta sold throughout Italy and 22 percent of the pasta sold throughout Europe. Additionally, the company also …show more content…
The distributors do not use forecasting systems or sophisticated analytical tools for determining order quantities and they have very limited and no seasonal demand data. Accurate demand forecasting is essential for companies and can be obtained by utilizing central demand information where each stage of the supply chain understands the forecast data.
Inflated Orders
Since Barilla’s distributors and retailers only perform periodic reviews of their inventory systems at times they would experience stock outs, which would create demand fluctuations in products when they were temporarily out of stock. In order to meet the demands Barilla would have to change their manufacturing and logistics operations which strained the production facility because of the different processes procedures in place for “dry” and “fresh” products.
Lead Time
Barilla is experiencing lead time fluctuations in their product lines, which vary from 8 to 14 days from the time the order is placed to the time the product is received by the distributors. In some instances supermarkets would place their orders by fax and it would take up to 24 to 48 hours for it to be received by the distributor. The ordering processes are outdated, which adds to variability and reduced inventory and service levels for the company and their distributors and retailers.

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