Study of the Supply Chain Rajesh Bagrecha (069) Shubhajit Roy (084) Subhash Wagle (089) Somanath (088) HINDUSTAN COCA COLA BEVERAGES PVT. LTD (HCCBPL) Mentor: Mr. R. Dattir
Study of the Supply Chain
Rajesh Bagrecha (069) Shubhajit Roy (084) Subhash Wagle (089) Somanath (088)
HINDUSTAN COCA COLA BEVERAGES PVT. LTD (HCCBPL)
Mentor: Mr. R. Dattir
Flows in Supply Chain
Customer
Information
Product
Funds
- A roadmap for the study of the supply chain
HCCBPLHCCBPL
A Framework for Structuring Drivers
Competitive Strategy
Supply Chain Strategy
Efficiency Responsiveness
Facilities Inventory Transportation
Information
Supply chain structure
Cross Functional Drivers
Sourcing Pricing
Logistical Drivers
• Coca-Cola returned to India in 1993 after a 16 year hiatus, giving a new thumbs up to the Indian soft drink market
• In the same year, the Company took over ownership of the nation’s top soft-drink brand and bottling network
• Indian operations comprises 50 bottling operations, 25 owned by the Company, with another 25 being owned by franchisees. That apart, a network of 21 contract packers manufacture a range of products for the Company
Coca-Cola in India
• HCCBPL commenced marketing operations in the year 1993 and manufacturing activity in the year 1998
This promise drives their supply chain strategy Coca Cola strives to deliver high quality product to the point of demand in 24 hour time span
Challenges: – Logistics Infrastructure– Unorganized retail sector– Coordination with widespread customer base– Able competitors
Coca-Cola is...
•The Symbol of Quality •Customer and Consumer Satisfaction•Responsible Citizen of the World
Products of HCCBPL
• Thums Up (200 ml/ 300 ml)• Limca (200 ml/ 300 ml)• Sprite (200 ml/ 300 ml)• Fanta (200 ml/ 300 ml)• Coca Cola (200 ml/ 300 ml)• Kinley soda (200 ml/ 300 ml)• Kinley mineral water(500 ml / 1000 ml/ 2000 ml)
Information FlowRaw Materials
Mineral Water and soft drink bottles
Suppliers Plant
Customer
RetailerDistributor
Depot D-56
THE CHAIN OF SUPPLY..
Empty bottles
Primary sales Secondary sales
High market
penetration and reach
Suppliers
Distribution zones (districts)
Upstream Supply Chain of HCCBPL
RM Items Supplier Supplier Location Inventory levels (qty / days of supply)
Sugar Renuka Sugar (single source) Karnataka 300 tons/1 week
Non-alcoholic beverage base
Coca Cola India (single source) Pune 15 days
Glass bottle Hindustan National Glass
Sinner (MH), Hyderabad 1-1.5 lac pcs
Crown ManakshayaL&T Daman 3-7 days
Crates Nilkamal Daman One time buy
CartonsNMT packaging,
Shivam Cartons, Cam Enterprises
Wada, Pune 2-3 days
Water MIDC supply (single source) Nashik 2 days
Internal Chain of supply
Receipts Invoicing Weighing Quality Check Picking & Staging for Stores Batch Making
Other activities at HCCBPL
Dispatches House Keeping Crate Washing & Management Transportation related MIS & coordination Tracking of costs of transportation Negotiating contracts with transporters MIS preparation
Automated Chain of Internal Supply
Downstream Supply Chain• Inventory
– 62 Distributors are contractually bound to carry minimum 3000 cases in lean season and 5000 cases in peak season & sell predetermined amount in specified time; not allowed to carry beyond a pre-determined upper limit
• Transportation cost optimization– Transportation costs are optimized through proper vehicle selection (HCV 16
tons, HCV 9 tons or LCV 6 tons)– FTL is achieved by consolidation of supplies with the depot (D-56)– The same vehicle is used for carrying empty bottles back from distributors
• Distributor selection process– Distributors are selected through a well defined process by cross-functional
team from Coca Cola, India
Cycle view of HCCBPL Supply Chain
Customer Order Cycle
Replenishment Cycle
Manufacturing Cycle
Procurement Cycle
Customer
Retailer
Distributor
Manufacturer
Supplier
PULL PROCESSES
PULL PROCESSES
PUSH / PULL PROCESSES
PULL PROCESSES
Supply Chain Coordination
Distributors
Coca-Cola, India, Pune
DAS
Sales Executive
Invoice, Physical products and
dispatch informationSales details,
inventory and demand information
Demand information and quantity of empty bottles
available at distributor
N.B: “Best Before Dates” to be given due priority
Forecasting Model
Pyramid forecasting – Done at Corporate office, Pune
Rolled up fo
reca
st
Forced down adjustment
Flow of funds in the chain Distributors make advance payments for supply of beverages by
EFT/Cheque in favor of Coca Cola India, Pune
Retailers buy on credit from distributors and pay in predetermined time intervals
HCCBPL pays its suppliers in 20-25 days which is the lead time for payment processing from Coca Cola India, Pune
Efficient Cash Flow
Management
Managing seasonal demand
• Seasonal pattern of demand considered during forecasting
• Workforce added just before peak months• Transport arrangements planned as per forecast• Fully machinery utilization in peak months
Peak Capacity Normal capacity UOM
CSD Beverages4000 cases / shift 2800 cases / shift Case (24 bottles)
Packaged water 3300 cases /shift 2500 cases / shiftCase (15 bottles)
Supply Chain metrics for HCCBPL
• KPI – Service Index – target 100 % order fill rate within 24 hours– Challenges:
• Transport shortages• Manpower shortages• Finished goods shortages
• Maintain transportation cost within pre-determined levels (changes based on fuel prices, toll taxes considered)
Supply Chain Macro processes
• Source• Negotiate• Buy• Design Collaboration• Supply Collaboration
SRM ISCM CRM
• Strategic Planning• Demand planning• Supply Planning• Fulfillment
• Market• Price• Sell• Order management
Not under control of HCCBPL