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Barilla Spa

In: Business and Management

Submitted By caliguyyy78
Words 855
Pages 4
Jose A. Lavaro
April 8, 2015

Barilla SpA (A)

Introduction Barilla SpA is the world’s largest pasta manufacturer that’s based in Italy. The company enjoyed a 35% market share of the entire pasta industry in Italy and 22% market share in the entire continent of Europe. It manufactures pasta and sells to various retailers largely through third party distributors.
In the late 1980’s, Barilla has been faced with fluctuations of variability in demand, which is straining the manufacturing and distribution system of the company. This has increased operational inefficiencies that resulted in week-to-week variations in its distributors’ order patterns, which has increased the cost of the company of having to hold a high inventory of goods in its distribution centers.
Due to the abovementioned crisis, the former director of logistics proposed Just-In-Time-Distribution (JITD) to eliminate overhead costs and prevent fluctuational shortages and overstocking in distribution centers. This however was never implemented because of the customers’ hesitance and reluctance in providing the company with historical sales data. In addition, there was also an internal resistance rom the company’s own sales and marketing organizations that thought that the idea was infeasible.
Problem statement To be able to convince Barilla’s customers both internal and external that the JITD will be beneficial not just to Barilla itself but to the customers as well.

Key Factors * Increased variable ordering patterns. * Lack of computer forecasting system at distributor levels. * Reluctance of customers in providing sales data. * Sales team believes that JITD will slow down sales promotion. * Sales team resistance to change * Bullwhip effect in the supply chain inventory in response to changes in the customer demand. * Poor internal communication between...

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