Highlights
Learning Outcomes
1.To understand the concepts, theoretical ideas and build on the experience, and ideas The supply chain game.
2.To evaluate and apply these concepts, theoretical ideas and empirical findings to develop your own views on strategic decision-making in organisations.
Case: The Pandemic's Bullwhip Effect on Food & Beverage Inventory
We chat with an expert about what's causing major supply chain disruption in the food manufacturing space and what brands can do about it.
As the COVID-19 pandemic has progressed, so have the effects on supply chains across industries. Brands are feeling what is called the bullwhip effect, a supply chain phenomenon that has plagued the consumer-packaged-goods (CPG) industry and caused major disruptions and allocation issues, especially in the food manufacturing space.
The bullwhip effect causes massive miscommunication between suppliers and retailers as the demand for products increase and decrease exponentially in a short amount of time. As suppliers are fulfilling the demand of yesterday, the demand of today could be completely different from that of tomorrow.
Food Manufacturing recently spoke with Ronen Lazar, CEO and co-founder of INTURN — a platform helping companies sell their excess inventory remotely and more efficiently — how the bullwhip effect is impacting the supply chain now, how it’ll impact the future and what brands can do to combat its effects. See our discussion below:
FM: Why is excess inventory such a major issue for food & beverage manufacturers?
Lazar: It’s a complex challenge. First and foremost, it hurts profit margins. From lost sales due to spoilage to high operational costs (storage and offloading), mismanaged excess inventory has the potential to produce millions in lost revenue each year. And then there’s the environmental aspect of it. Excess inventory often becomes food waste, which ends up in landfills that produce the greenhouse gas emissions causing climate change. That has its own set of consequences for both brands and the planet we live on.
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