Beginnings — [ edit ] The Co-operative Group has developed over years from the merger of co-operative wholesale societies and many independent retail societies; evolving from solely a wholesale operation to a major retailer. The Group's roots are traced back to the Rochdale Society of Equitable Pioneersestablished in
Comment When its original logistics and procurement model threatened to constrain its rapid growth, the U.
Here's how it all paid off. In today's fast-paced, hours-a-day world, our society has come to depend on coffee to keep the wheels turning.
Costa Express was created to serve this need in when the Whitbread Group, the largest hospitality company in the United Kingdom and owner of Costa Coffee, acquired Coffee Nation, a provider of self-service coffee concessions.
The new company, Costa Express, partners on a revenue-sharing basis with retailers that service public places like airports, railway stations, hospitals, universities, convenience stores, gas stations, and offices, enabling them to profit from the growing consumer demand for premium coffee "on the go" as well as the strong Costa brand.
Costa Coffee is the largest coffee retailer in the U. Costa Express provides its partners with up-to-date, self-service coffee machines and regularly restocks the coffee and supplies, so very little investment is required to get the business up and running. After achieving early success in its first year, Costa Express set ambitious plans to increase the number of machines in operation—what it refers to as its "estate" —from to 3, byand at the same time to expand internationally.
For months after the launch, the business was pushed to the limit as the existing machine estate was rebranded from Coffee Nation to Costa Express, and new partners signed on.
In Aprilthe company realized that in order to deal with all the expected growth, it would need to make some changes to the way it managed its supply chain. That was when I joined Costa Express, specifically to fill the newly created position of supply chain manager and to join a strengthened operational leadership team.
Prior to that time, there had been no dedicated supply chain function in the company. Instead, traditional purchasing and logistics activities were split between the finance and engineering teams. One of my first tasks was to identify three fundamental supply chain functions that were driving the business.
Managing and replenishing coffee-making ingredients to partner sites Procuring and maintaining spare-parts inventory Effectively managing the process of procuring new Costa Express machines and preparing them to be installed at customer sites For the purposes of this article, I will describe how we managed the first and most critical of these three functions: Drawbacks of the old model Costa Express's distinctive model involves pushing coffee-making supplies out to our partner sites free of charge, and then sharing the revenue collected.
When I joined the company, the finance team carried out this replenishment activity with support from trained employees known as "Brand Guardians," who work in the field. The Brand Guardians' job was to train partners, replenish stock for them, and give them advice on how to maximize sales and improve the coffee experience for the customer.
In order to sustain this unique model during a phase of significant growth, Costa Express would need tight control over and visibility into its supply chain.
Central to this would be an awareness of exactly when and how much stock needs to be replenished at each partner site, so that money would not be wasted on excess inventory or unnecessary logistics activities. That meant Costa Express would need to understand not just aggregated order information, but also the size and frequency of the individual orders.
To support this need for order-line-level detail, Costa Express's self-service coffee bars were equipped with integrated telemetry that provided real-time reporting on machine performance and beverage sales. These systems had a twofold purpose: The system that informed replenishment decisions comprised thousands of linked spreadsheets that contained detailed information for each site and product.
Based on the size of our partner network, the system had multiplied to host more than 50, replenishment combinations and was edging towardas new sites were added. One thing that greatly concerned me: Despite having invested in coffee machines with built-in programs designed to provide real-time sales data, Costa Express could not take advantage of this capability because our spreadsheet system could not extract, consolidate, and present up-to-the-minute data.
The next area I examined within the ingredients supply chain was logistics. Our current logistics provider was furnishing a full service: Although this setup might have worked well in the beginning, it meant we had very few direct relationships with ingredients suppliers, making it difficult to negotiate and communicate changes we wanted to make as our business grew.
It became clear to me that in order to deliver sustained growth, we would have to transform our supply chain and redefine roles within the wider business A fresh start During my first month Aprilit was clear that I needed to make some changes without delay. These initial changes would lay the foundation for the rest of the strategic changes that would be necessary.
I therefore immediately moved responsibility for partner replenishment from finance to the new supply chain team. This change would ensure that partner replenishment would receive the right amount of attention during the transformation.
I next undertook a review of providers of replenishment and demand planning software, which included looking at how we could tap into our valuable telemetry data and use this to maintain the inventories at partner sites. In JuneI initiated a tender process designed to seek out a new logistics partner.
This process included reviewing relationships with suppliers and assessing whether Costa Express should start to purchase ingredients directly from suppliers. By Novembermy team and I had come up with both a new replenishment planning tool and a new logistics provider, Howard Tenens, and planned to have them both up and running by January As part of this plan, we had decided to start purchasing ingredients directly.
By doing so, we would be able to negotiate and control our costs more effectively as our volumes grew.The Home Depot builds an omni-channel supply chain The Home Depot has remodeled its supply chain in recent years, building the foundation for a new type of fulfillment center intended to blend online and in-store shopping.
What are some different ways that a convenience store supply chain can be responsive? What are some risks in each case? In order to be response, a store has to make a selection between holding large inventory or frequent orders & frequent delivery routes.
Logistics, Supply Chain, Supply Chain Management. Building Visibility, Response, Resiliency. To maximize productivity, efficiency, and profit, Chief Supply Chain Officers should strive for visibility into the supply chain and confidence that it could handle any type of disruption.
Improved globalization of the supply chain and still more outsourcing were viewed as the main two levers to reduce supply chain costs. The chart below is a good one, showing what supply chain related functions are done internally, either at a local or global level, or outsourced, as well as the percent change expected in outsourcing between.
This article starts with the reasons to bullwhip effect phenomenon, analyzes how to enhance inventory management strategy to reduce the bullwhip effect in supply chain management.
And then, we study the case of McDonald's and its third-party logistics system HAVI cooperation to explore the cooperation mode between the two companies. For supply chain executives, the early years of the 21st century have been notable for major supply chain disruptions that have highlighted vulnerabilities for individual companies and for entire industries globally.
In addition to taking many lives, the Japanese tsunami .