Describe Barilla's Manufacturing And Distribution Operations

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1. Describe Barilla’s manufacturing and distribution operations. Barilla's has 25 manufacturing plants located all throughout Italy where each plant has a dedicated product that they manufacture ranging from pasta, flour mills, fresh bread and specialty products such as croissants and Christmas cakes. Raw materials, in the manufacturing process, were transformed to packaged pasta on fully-automated 120 meter long production lines. Each plant specialized in manufacturing a type of pasta with the main distinction being the composite of the pasta i.e. dry or fresh pasta, or pasta with or without eggs and spinach. Even within the same family of pasta products, individual products were assigned to plants based on the size and shape of the …show more content…
Barilla's sales strategy is to rely on the use of promotions in the form of price, transportation and volume discounts with sales representatives being rewarded based on the quantity of products sold to distributors. This led to sales representatives trying to push product to the distributors during promotions impacting the ability to accurately forecast sales. Secondly, the lack of communication amongst all members of the supply chain is limiting the ability to accurately forecast demand. This can cause high levels of excess inventory or high levels of stock outs depending on the situation. Due to the limited demand visibility within the supply chain and the lack of communication and cooperation, the supply chain is unable to react quick enough to increases in demand. This has led to higher levels of safety stock being maintained in an attempt to avoid stock outs. This demand variability has impacted Barilla greater than any other member of the supply chain given their position within the chain. Third, the large number of stock keeping units (SKU) made the manufacturing and distribution of a large quantity of different products extremely complex. Having over 800 dry products in 8 different package types is very difficult to manage. This also led to the inability of Barilla to respond quickly to increases in demand, given the long lead time of their products. The temperature constraints and variability for each of
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