Barilla SpA (A)
Christel Bou Farhat
Notre Dame School
1- Diagnose the underlying reasons behind the difficulties which the JITD software was created to resolve. What are the advantages and drawbacks of the program? In your answers, consider the Barilla and marketers points of look at (400-500 words).
* Barilla's Supply Chain suffered with the bullwhip effect that was generally caused by the need fluctuations and damaging the company's manufacturing and distribution system. This fluctuating demand occurred due to: * Product variability: Different types of goods (Fresh and Dry) based on a shelf lives and the numerous stock keeping unit (800 SKUs), creating the channels of droit to be more complicated. * Special offers and volume level discounts: As stated in the case: " Barilla's revenue strategy relied on the usage of promotions to enhance its products into the grocery circulation networkвЂќ (Hammond, 1994) They divided each year into 12 to 12 canvass, through which they offered different discount rates, ranging from 1 . 4% in semolina teigwaren for example or over to 10% on additional products such as breadsticks. 2. Long Business lead Times: Barilla shipped many to their distributors between almost 8 and 2 weeks after placing your order, making the regular lead moments of 10 days. This really is a long period and will amplify the bullwhip result. * Vendors inaccurate predicting: According to the circumstance: " The majority of distributors used simple regular review products on hand systemsвЂќ (Hammond, 1994) and " only few acquired forecasting devices or superior analytical equipment for determining order quantitiesвЂќ (Hammond, 1994). * Profit and drawbacks with the JITD program:
5. A JITD approach helps you to save the entire supply chain funds as it will: reduce the distribution and making costs, decrease the level of products on hand, increase the support level, and improve the procedures for Barilla and its buyers; and all that by certainly not responding to the fluctuating require caused by marketers. * With the JITD...
References: Hammond, L. H. (1994). Barilla Day spa (A); Harvard Business School. [Case].
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