Barilla Spa Case Study Analysis

3647 WordsSep 13, 201015 Pages
Barilla SpA (A) Case Study Analysis 2 Diagnose the underlying causes of the difficulties that the JITD program was created to solve. What are the benefits and drawback of this program? Brando Vitali, Barilla’s director of logistics, proposed the idea of Just-In-Time Distribution (JITD) in the 1980’s as an alternative to Barilla’s traditional practice of delivering products to their distributors (Hammond, 1). Instead of distributing Barilla’s products based on the orders the distributors placed with the company, Barilla’s own logistics organization would determine the product quantities to distribute that would most effectively meet end-consumers needs. This in turn, would more evenly distribute the workload on Barilla’s…show more content…
Elimination of the “canvass” periods would discourage sales representatives who used these periods to sell more products to distributors to achieve sales targets (Hammond, 6). The volume discounts that were offered to the distributors for truck load quantities and multiple truck load purchases of pasta would also cease to exist with the JITD program. The entire relationship between the sales representatives and distributors appears to weaken with the JITD program, as the sales representatives lose their traditional areas of influence and the ability for distributors to control their inventory is taken away. The JITD program is a shortsighted view of a “push” model based on point-of-sale demand (i.e. “pull” from the end consumer). In other words, even though the end-customer demand would be used to generate production quantities, the demand would not be pulled from the downstream process, i.e. the distribution centers. The program would completely cut-out the distributers needs and the majority of the distributors and supermarkets did not have the infrastructure to realize Barilla’s vision. Most grocers in Italy weren’t equipped with the necessary bar-code scanners and computer linkages to provide actual retail sell–through data to Barilla. On the other hand, Barilla wasn’t prepared

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