Group 11 presented a case analysis of Barilla Spa, one of the largest pasta producers in the world. Barilla was facing issues meeting unpredictable demand for its dry goods. The head of logistics, Brando Vitali, proposed a "Just-in-Time Distribution" (JITD) system to address production and inventory problems caused by variable demand. JITD would involve distributors providing daily sales data so Barilla could ship only what was needed, reducing costs. While challenging to implement, JITD could benefit both parties if introduced with flexibility and cooperation between Barilla and distributors.
Group 11 presented a case analysis of Barilla Spa, one of the largest pasta producers in the world. Barilla was facing issues meeting unpredictable demand for its dry goods. The head of logistics, Brando Vitali, proposed a "Just-in-Time Distribution" (JITD) system to address production and inventory problems caused by variable demand. JITD would involve distributors providing daily sales data so Barilla could ship only what was needed, reducing costs. While challenging to implement, JITD could benefit both parties if introduced with flexibility and cooperation between Barilla and distributors.
Group 11 presented a case analysis of Barilla Spa, one of the largest pasta producers in the world. Barilla was facing issues meeting unpredictable demand for its dry goods. The head of logistics, Brando Vitali, proposed a "Just-in-Time Distribution" (JITD) system to address production and inventory problems caused by variable demand. JITD would involve distributors providing daily sales data so Barilla could ship only what was needed, reducing costs. While challenging to implement, JITD could benefit both parties if introduced with flexibility and cooperation between Barilla and distributors.
Group 11 presented a case analysis of Barilla Spa, one of the largest pasta producers in the world. Barilla was facing issues meeting unpredictable demand for its dry goods. The head of logistics, Brando Vitali, proposed a "Just-in-Time Distribution" (JITD) system to address production and inventory problems caused by variable demand. JITD would involve distributors providing daily sales data so Barilla could ship only what was needed, reducing costs. While challenging to implement, JITD could benefit both parties if introduced with flexibility and cooperation between Barilla and distributors.
Background: One of the biggest producers of pasta in the world is an Italian firm called Barilla Spa. Barilla has a market share of 22% in Europe and around 35% in Italy alone. It is renowned for its bread, cookies, biscuits, and other bakery goods in addition to the variety of pastas it produces. By giving its pasta a distinctive brand name and image and distributing it in a sealed cardboard box with a recognisable colour pattern, they revolutionised the marketing techniques used by the Italian pasta business. Italian-based Barilla owned and ran a vast network of manufacturing facilities, including fresh bread and pasta factories. For the development and testing of novel goods and manufacturing techniques, Barilla maintained cutting-edge R&D facilities and a pilot production facility. Three brands were used by Barilla to advertise its pasta products; the old Barilla brand had 32% of the market, while the Voiello and Briabanti brands each held 3%. In Italy, the north and the south each received half of the sales of Barilla's pasta. Three pasta divisions, Bakery Products, Fresh Bread, Catering, and International were the seven divisions that Barilla was divided into in 1990. Barilla separated its product line into two categories: "dry" and "fresh," which accounted for 75% and 25% of Barilla's sales, respectively. The majority of Barilla goods were transported from the manufacturing facilities to one of the two central distribution locations (CDCs). Products arriving at these distribution centres were sent fast through the system; generally, each CDC carried three days' worth of fresh product inventory, but one month's worth of dry product inventory. The CDCs did not handle fresh goods like bread, which had a shelf life of just a few days. Analysis: Barilla began to see the consequences of changing demand more and more. The demand for dry goods was erratic and changed week to week. Barilla's production and logistics operations struggled to maintain adequate finished products inventories due to the high unpredictability in demand. The shifting demand made it incredibly costly to meet distributor order needs each and every week. The production staff advised the distributors to have more inventory on hand to smooth out any changes in their orders. This decision was opposed by a large number of distributors since it had drawbacks of its own. At the time, Brando Vitali, Barilla's head of logistics, stated strong opinions in favour of developing an alternate method of order fulfilment that benefits both distributors and producers. For both themselves and the stores, he wanted to make the operations better. His strategy was to transport goods only when they were really required, which would save production, distribution, and inventory expenses. The distributor would provide Barilla the information it needed on the goods that had been delivered to the distribution centre the day before. The corporation wanted to increase its market edge via forward integration. Barilla's forecasting system had flaws of its own, but they planned to fix them based on the information they finally received. "Just-in-Time-Distribution" was Vitali's suggestion. This approach was suggested as a solution to issues that strain Barilla's Manufacturing and Logistics operations, such as the consequences of variable demand and the stock out problem.
Recommendation: Supplying distributors with numbers decided by Barilla rather than the distributors The purpose of placing the order is to assist end users in meeting their needs and burden. If this approach is used, the workload will be equally allocated between the logistics division and the plant. Manufacturing and logistics won't be pushed to fulfil a specific request. The JITD system will be challenging to implement and has some drawbacks as well. commercial promotions The transaction becoming predictable causes sales personnel to lose their incentives. The Distributors may sometimes be reluctant to give their sales information, even if it is essential for the firm to ship the items. They anticipated that the number of sales representatives would be cut when disputes emerged inside the sales and marketing divisions. The updated system isn't adaptable enough to handle the adjustments. The rivals would benefit if the shelves in the distributor's unit were only partially stocked, allowing them to highlight their products more prominently than Barilla's. You may claim that these issues are brought on by a lack of enough flexibility in both the manufacturing process and the pay scale. for reps in sales. If JITD is introduced, the whole organisation should benefit. The management should craft the plan such that if it were adopted, it would be in the company's best interests. It is important to acquire the mindset that working with distributors is a one-time, long-term collaboration that should be maintained methodically via the use of several points of contact and data exchange between the distributor and provider. In order to deploy the system at the firm, it is important for me to understand a number of things as a Barilla client. I must first understand how the system would benefit my distribution facility and how it will assist me manage my stock. The system's contribution to enhancing performance indicators like delivery time and flexibility is the other important factor. and at the cheapest price. One of the main issues with doing business with Barilla is letting them handle all of the product forecasting and supply. The system's benefits exceed its drawbacks, and the supplier and distributor may cooperate with one another to improve and streamline the system.
