SUPPLY CHAIN MANAGEMENT ( National Beverages Company NBC ) ( Coca Cola / Cappy )

PowerPoint Presentation

SUPPLY CHAIN MANAGEMENT

( National Beverages Company NBC) ( Coca Cola / Cappy ) 23/5/2012National Beverages Company Presentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow System

Presentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow System

Project Information Project Name : Supply Chain Management

Project Supervisor :Dr. Yahya Salih

Project Team : Yazan TomaAlaa Yassin Malik Ammar Case Studys Company : National Beverage Company ( Coca Cola / Cappy )

National Beverages Company (Coca Cola/ Cappy)

A group of Palestinian businessmen established the National Beverage Company Coca-Cola/Cappy in 1998.

The Company has acquired the license of producing carbonated soft drinks, mineral water and juices from the International Coca-Cola Company, with high quality according to the state of the art manufacturing technologies in the world.In early 2005, the National Beverages Company acquired the production line of Jericho Water in Jericho along with the Palestinian Beverage Group.

In 2006, the Company acquiredCappy Production line in addition to theCappy juices trademarks.

The Company gave the Palestinian market the chance to keep up with the general development in the global industry, especially the food and Beverage industries.

National Beverage Company (Coca Cola/ Cappy)NBC Products

Carbonated Drinks

Water and Juices

NBC ProductsPresentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemComment on this Picture !

Supply Chain Management ( S.C.M)What is S.C ?

Modern SC View An effective SC ensures high level of Customer Service at optimum level of working capital and cost!Business Partners/SC viewAn efficient supply chain that ensures products are on the shelf, available for sale, when Shoppers come to buy them ... all the time! The supply chain consist of suppliers, manufacturing centers, warehouses, distribution center and retail outlet, as well as raw material, work-in-process inventory, and finished products that flow between the facilities. [Simchi-Levi, 2003]

General Definition of S.C

Generic configuration of a supply chain in manufacturingS.C Elements and Logistics Network

Supply Chain Stages A typical supply chain may involve a variety of stages:

Customers

Retailers

Wholesales/distributors

Manufacturers/ Plants

Component/raw material suppliers

Supply Chain levels of activityNear termProduction planning and control decisionsGoods and service delivery schedulingSome make or buy decisionsIntermediate termDetermining inventory levelsQuality-related decisionsLogistics decisionsTacticalOperationalWhy implementing a Supply Chain approach ?

Poor service

Empty shelves

Poor forecastingIts all about Managing Expectations..What is the Supply Chain Concept ? Demand & Supply Planning Data Integrity Order & Query Mgmt Warehousing & Delivery Stock MgmtCUSTOMER FOCUSSEDPresentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemBranches and Locations of NBC CompanyPlants Location: NBC Company has three production plants: Ramallah plant for all CSDs products (Coca Cola).Tulkarem (Kufr Zebad) plant for Cappy and Arwa water products (Cappy).Jericho plant for Jericho water products (Jericho).

Warehouses Location:Ramallah WH, Hebron WH, Tulkarem WH, Jericho WH andGaza WH.

NBC Distribution Centers S.C Elements and Logistics Network at NBC companyLocal and Outside supplier(s)Coca Cola/ RamallahGaza WHHebron WHJericho WHRamallah WHretailerretailerretailerretailerCustomer demandCustomer demandCustomer demandCappy/ TulkarmJericho/ Jericho Ramallah WHTulkarem WHretailerRecycle and remanufactureJericho has a special Company for marketing and distributing of Jericho productsPresentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemLiterature Review Classification Criteria References Supply Chain- Basic Information Chopra & Meindl (2001), Novak & Simco (1991), Ganeshan & Harrison (1995), Lee & Corey (1995), Davis (1993), Lummus et al (1998) and Christopher (1998).Supply Chain- Objectives

Simchi-Levi (2003), Cooper & Ellram (1993), Davis (1993), Lummus, Vokurka, & Alber (1998), Chopra & Meindl (2010). ABC classification

Dub (1989), Christopher (1998), Needy & Kim (2003) and Fogelholm (2006). Demand Forecasting Jacobs (2011), Wirl &Szirucsek (1990), Hariharan & Zipkin (1995), Emmons & Gilbert (1998) and Tan (2008). Classification of the literature available on SCMAll literature reviews have been gathered from international books, research papers and previous studies at NBC company. Literature Review Classification Criteria References Production and Inventory Control Porteus (2002), Chopra (2010), Tan et al (2007) and Wang and Toktay (2008). Stock Keeping Unit (SKU)Silver et al (1998) and Tan et al (2007). Typical Inventory Control PoliciesSilver et al (1998) and Christopher (1998). Coordinated Replenishments Stochastic DemandSilver et al (1998) and Simchi-Levi (2003). Multi-Echelon InventoriesChopra & Meindl (2001 and Silver et al (1998) .Strategic Planning

Hayes (1985), Hieber (2002) and Seuring (2003). Information Flow SystemPorter (1985), Currie (2000), Simchi-Levi (2003) and Powell and Zheng (2007).Transportation models Chopra (2010). Presentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemProblem Statement The problem selected to the analysis can be classified into two categories A and B:

Information flow systemCategory BCategory A: Inventory and warehouses system at NBC companyThe list of symptoms can be summarize into:

NBC company is using a stock level of inventory gained from old studies which is not applicant nowadays result of significant changes in Palestinian market during the second Intifada.

NBC company doesnt use inventory control polices and coordinated Replenishments according to Stochastic Demand.

Warehouses and distribution centers at NBC company have been built to meet the demand based on old studies for Palestinian market in west bank and Gaza.

What are the objectives of studying the Inventory and warehouses at NBC ?

To have stock available as and when required.To avoid both overstocking and under stocking of inventory.To insure right quality goods at reasonable price.To design proper organization for inventory management. To bring down the inventory carrying cost.Short and long term planning and control of inventory.To decide which item to stock and which item to procure on demand.Category B: Information flow system

The list of symptoms can be summarize into:

Uncertainties in NBCs supply chains while every single members has a perfect information about itself.

Time wasting in decision making.

Poor coordination between the members of supply chains at NBC company.

Inefficient information security system while the Palestinian market is highly competition.

Due to the expansions of NBC company which can be represented in three main plants ( Coca Cola, Cappy, Jericho), five main warehouses ( Ramallah, Gaza, Hebron, Tulkarm, Jericho) and diversity of retailers, the sharing of the information between these parties became harder and exhaustive. 30Presentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemPlan of the project and methodology:

Methodology in General:

Palestinian market study : Collection of the essential information in order to forecast the demand.

Logistic study of the Coca cola network in Palestine.

Checking the international standards of Coca Cola.

Applying the supply chain strategies ( using mathematical applications) on our case-study ( Coca Cola ).

Ending up with the best solutions and strategies for Coca Cola company in Palestine which can be implement in order to achieve all objectives.

Inventory and Warehouses system

A-B-C classificationStudying the demand and finding the best method for forecasting.Studying the inventory problems.Building the dynamic inventory model.Determination of economic order quantity. Determination of stock level.Determination of safety stocks.Selecting the proper system of ordering for inventory.Ending up with the final inventory model, which will be solution for our problem with numerical example.

Plan of the project and methodology:

Information Flow System

Studying the information flow system of the company.

Detecting and identifying the problems and the area for improvement.

Build the information system for the company with the improvements and modifications.

Ending up with final information flow system, which will be the solution for our problem.Plan of the project and methodology:

Presentation Outlines Project Information Supply Chain Management ( S.C.M) S.C.M at NBC Co. Literature Review Problem Statement Plan of Project and Methodology Results and Conclusions Inventory Dynamic Modeling Information Flow SystemResults and Conclusions

Statistics and Figures

NumberBranchs(Demand) L /Year1Center Branch24161050.012North Branch 19573643.923South Branch 18026015.54Results and Conclusions


Results and Conclusions






Inventory and Warehouses system:

A-B-C classificationA: Most important items, first 5-10 % of items. The items of center branch are:

Item

Description Cum % of Total Usage8Coca Cola (PET 2.0 LT)0.21718178517Coca Cola (PET 1.125 LT)0.31806234510Sprite (PET 2.0 LT)0.39950478732Jericho (PET 1.5 Ltr (8))0.4724679911Coca Cola (330mL)0.54467899820Sprite (PET 1.125 LT)0.5988558523Coca Cola (NBR 300 mL)0.64678938331Arwa Water (PET 0.5 Ltr)0.6807814754Sprite (330mL)0.7121170611Fanta Orange (PET 2.0 LT)0.73926467925Sprite (NBR 300 mL)0.765004214Inventory and Warehouses system:

A-B-C classificationB: Intermediate important items, 50 % of items. The items are:

ItemDescription Cum % of Total Usage30Arwa Water (PET 1.5 Ltr)0.7865661422Fanta Orange (PET 1.125 LT)0.8033793953Orange Drink (PET 1.5 LT)0.8191016136Fanta Orange (330mL)0.83408811813Coca Cola (PET 0.5 LT)0.84750899419Coke Zero (PET 1.125 LT)0.8587181833Jericho (PET 0.5 Ltr)0.86852994127Fanta Orange (NBR 300 mL)0.87737790634Arwa Water (5 Gallons)0.88608771654Strawberry & Banana Drink (PET 1.5 LT)0.89376633555Mango Drink (PET 1.5 LT)0.9007131673Coke Zero (330mL)0.9075266449Diet Cola (PET 2.0 LT)0.91431354915Sprite (PET 0.5 LT)0.92081382537Mango Nectar (200 mL)0.9254875827Fanta Strawberry (330mL)0.9296115932Diet Cola (330mL)0.93369931716Fanta Orange (PET 0.5 LT)0.93746559857Grapefruit Drink (PET 1.5 LT)0.9411218158Apple Drink (PET 1.5 LT)0.94457118612Fanta Strawberry (PET 2.0 LT)0.94796567759Orange Drink (PET 330 mL)0.951265974Inventory and Warehouses system:

A-B-C classificationC: Least important, 40-45 % of items, only 20 % of value.

ItemDescription Cum % of Total Usage5Sprite Diet Sprite (330mL)0.95399172828Fanta Strawberry (NBR 300 mL)0.95665579461Grape Drink (PET 330 mL)0.95929566956Grape Drink (PET 1.5 LT)0.96185571360Strawberry & Banana Drink (PET 330 mL)0.96438491248Orange Drink (200 mL)0.96689359935Arwa Water (5 L)0.96924311649Mango Drink (200 mL)0.97141771138Strawberry & Banana Nectar (200 mL)0.97356937550Strawberry & Banana Drink (200 mL)0.97566000741Guava Nectar (200 mL)0.97757777221Diet Sprite (PET 1.125 LT)0.97945161462Mango Drink (PET 330 mL)0.98132039118Diet Cola (PET 1.125 LT)0.98318894229Coke Zero (NBR 300 mL)0.98496397840Apple Nectar (200 mL)0.98664149351Apple Drink (200 mL)0.98823116364Apple Drink (PET 330 mL)0.98963728252Mixed Fruit (200 mL)0.99093907643Mango Nectar (1.0 LT)0.99214743124Diet Cola (NBR 300 mL)0.99303570526Diet Sprite (NBR 300 mL)0.99392397946Apple Nectar (1.0 LT)0.99479063239Multivitamin Nectar (200 mL)0.99789513147Guava Nectar (1.0 LT)0.99857248763Grapefruit Drink (PET 330 mL)0.99923230414Diet Cola (PET 0.5 LT)1Inventory and Warehouses system:

A-B-C Diagram of all NBC Co. ProductsStudying the demand and finding the best method for forecasting.Basic Approach 1- Understanding the objective of forecasting2- Integrating demand planning and forecasting throughout the supply chain3- Understanding and identifying the customer segments


4- Identify major factors that influence the demand forecast

5- Determining the appropriate forecasting technique6- Establishing performance and error measures for the forecast


Coca Cola (PET 2.0 LT)Branch/MonthJanFebMarAprMayJunJulAugSepOctNovDecTOTALCenter Branch199073100936177465135168151681634156341552847475623170826423522338North Branch 182482368737899378994263752112580875324648406435663388429043478714South Branch 15792157922763531583394793947948636445834053136478324252837240078546Inventory and Warehouses system:

Dynamic Models Derivations:

47Inventory and Warehouses system:



Raw Material Dynamic Model Derivations



Raw Material Dynamic Model Derivations




Finished Goods Dynamic Model Derivations (EPQ)





Center Branch (SKU)NumberDescriptionDiAiPivirimiEPQiTRCi(EPQi)TRi(Cycle Time)i(Cycle Time)iYearDays1Coca Cola (330mL)11940081390.61313401828.901044.56130.570.01534.792Diet Cola (330mL)675981390.67435435.14248.5331.070.064420.153Coke Zero (330mL)1126681390.612393561.79320.8640.110.049915.614Sprite (330mL)5181381390.6569941204.78688.1086.010.02337.285 Diet Sprite (330mL)450781390.64958355.33202.9425.370.078824.686Fanta Orange (330mL)2478081390.627258833.18475.8659.480.033610.527Fanta Strawberry (330mL)681981390.67501437.07249.6331.200.064120.068Coca Cola (PET 2.0 LT)5223388970.45745725564.061502.04187.750.01073.339Diet Cola (PET 2.0 LT)163238970.417955983.59265.5233.190.060318.8610Sprite (PET 2.0 LT)1958758970.462154633407.26919.80114.980.01745.4411Fanta Orange (PET 2.0 LT)652928970.46718211967.19531.0566.380.03019.4358Inventory and Warehouses system:





(EPQ) EOQ and EPQ with Safety Stock and Reorder Point

Ramallah DC ( A Items)ItemDescriptionAVG DemandLead TimeSTDEV(D)STDEV(L)SSR(Months)8Coca Cola (PET 2.0 LT)43528.166670.00080128213653.336386.48398633.83373668.7120717Coca Cola (PET 1.125 LT)15886.166670.0008012825640.9582159.67819261.87223274.6015310Sprite (PET 2.0 LT)16322.916670.0008012825120.0727144.93352237.69097250.770231Coca Cola (330mL)99500.0008012823553.0443100.57576164.94425172.9170120Sprite (PET 1.125 LT)8531.50.0008012823029.323885.750843140.63138147.4675223Coca Cola (NBR 300 mL)5283.8333330.0008012821473.885441.72116668.42271272.65655331Arwa Water (PET 0.5 Ltr)9367.5833330.0056089743274.3301245.22468402.16848454.711024Sprite (330mL)4317.750.0008012821541.89343.64625171.57985175.03958711Fanta Orange (PET 2.0 LT)54410.0008012821706.631748.30949879.22757683.58735225Sprite (NBR 300 mL)2837.3333330.000801282791.5575722.40656136.74676139.02026562Inventory and Warehouses system:

(EPQ) EOQ and EPQ with Safety Stock and Reorder Point

63Information Flow SystemInformation Flow System:

Facts

The information model deals with the integration of supply chain members and concentrates on the flow of information among the chain members.Information technology plays a vital role for increasing collaboration among supply chain members. From the information point of view the effective supply chain management must provide the right amount of relevant information to the right person at the right time.Information is the key to successful supply-chain management because no product flows until information flows.

65Information Flow System:

Benefits of Information TechnologyHigher visibilityReduced transportation spendImmediate availability of informationGreater accuracyMore economicBetter customer serviceHigher productivityReduced paper workFaster processingIncrease on-Time DeliveriesImproved Capacity Utilization


Information RequirementsTo ensure that valuable, actionable knowledge readily flows across the supply chain, information must be

AccessibleRelevantAccurateTimelyTransferable


Information Sharing at NBC CompanyTo ensure that valuable, actionable knowledge readily flows across the supply chain, information must be

AccessibleRelevantAccurateTimelyTransferable


Suggested Improvements1- Electronic pick slip report for the warehouse/ transportation


Suggested Improvements2- Radio frequency identification (RFID)


Suggested Improvements

3- Creating a visionary Department

71

SUPPLY CHAIN MANAGEMENT ( National Beverages Company NBC ) ( Coca Cola / Cappy )

Documents