Barilla Spa Questions

1899 WordsJan 25, 20138 Pages
1. What is the impact of the fluctuations seen in Exhibit 12? What are the underlying drivers of the fluctuation we see in this exhibit? Your analysis should consider full range of implications to the entire channel, and not just Barilla. Per exhibit 12 the impact of order fluctuations are as follows: - Creates a bullwhip effect at Barilla. - Resource and material planning becomes cumbersome and inefficient. - Might increase the lead time because of the bullwhip effect. - Reduces overall operational efficiency. - Reduces the overall profitability due to reduction in efficiency. - Reduces the utilization of central distribution center. - The distributor must build excess…show more content…
Distributors would not stock their inventory with Barilla products that exceed the real demand. Thus, the JITD program would help Barilla’s partners reduce distribution costs and allow them to be more efficient. The project also might help improve Barilla’s relationship with its partners, as Barilla won’t exert pressure on distributors to hold more finished products than necessary. The implementation of the program will eventually improve the planning procedures for Barilla and enable the company to provide exceptional service to its customers at low costs. On the other hand, the JITD program will not be implemented without costs to Barilla. Although it is expected to highly benefit Barilla, JITD program would be costly to implement. Barilla would be responsible to provide its distributers with the technology needed to report daily sales. Moreover, it might not be possible for some retailers to report daily sales because their stores are not equipped with point-of-sale technology that captures sales data. Also, distributors might need to hire new employees in order to be able to prepare sales reports. In addition, implementing JITD means that Barilla would do the work for its distributors. This might cause
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