Barilla Spa - 2
Barilla was first founded in 1875 by Pietro Barilla in Parma, Italy. Pietro’s son led Barilla through momentous period of growth and in 1940s, he passed Barilla to his own sons namely Pietro and Gianni. As time passed by, Barilla evolved from its modest beginnings into a large, vertically integrated corporation with factories spread throughout Italy. The expansion of existing businesses both in Italy and other European countries as well as the acquisition of new and related businesses had enabled Barilla to enjoy growth rate of more than 21 percent in the 1980s. By 1990, Barilla had become the largest pasta manufacturer in the world.
As the 1980s marched, Barilla significantly felt the impact of fluctuating demand. Extreme demand variability strained Barilla’s manufacturing and logistics operations and as a result, Barilla suffered high operational costs. Thus, in order to overcome the problem, Vitali who was the Director of Logistics, proposed a solution which was to implement JITD ( just in time distribution) or what is known as VMI ( vendor-managed inventory).
However, neither Barilla’s customers nor Barilla’s sales and marketing personnels showed enthusiasm towards Vitali’s proposal. As the new Director of Logistics, Maggiali tried to find ways in order to increase chances that the idea of JITD would be accepted.
This paper will basically analyze the roots to Barilla’s problem and gives recommendations on how can JITD be implemented in better ways. As a start, this paper will discuss about Barilla’s product description and production process; followed by the distribution process in Italy.
2.1 Product description
Barilla differentiates its product line into two types namely the fresh products and the dry products. The fresh products include fresh bread which had a one-day shelf life and fresh pasta products which had 21-day shelf lives. Beside fresh bread, Barilla also produces panettone and croissants. On the other hand, the dry products include dry
As the 1980s marched, Barilla significantly felt the impact of fluctuating demand. Extreme demand variability strained Barilla’s manufacturing and logistics operations and as a result, Barilla suffered high operational costs. Thus, in order to overcome the problem, Vitali who was the Director of Logistics, proposed a solution which was to implement JITD ( just in time distribution) or what is known as VMI ( vendor-managed inventory).
However, neither Barilla’s customers nor Barilla’s sales and marketing personnels showed enthusiasm towards Vitali’s proposal. As the new Director of Logistics, Maggiali tried to find ways in order to increase chances that the idea of JITD would be accepted.
This paper will basically analyze the roots to Barilla’s problem and gives recommendations on how can JITD be implemented in better ways. As a start, this paper will discuss about Barilla’s product description and production process; followed by the distribution process in Italy.
2.1 Product description
Barilla differentiates its product line into two types namely the fresh products and the dry products. The fresh products include fresh bread which had a one-day shelf life and fresh pasta products which had 21-day shelf lives. Beside fresh bread, Barilla also produces panettone and croissants. On the other hand, the dry products include dry