Barilla Spa Case

Barilla SpA Case

Donna Gerhardt

Barilla’s SpA

Barilla SpA started as a small pasta company in 1875. Today it has grown into one of the largest pasta manufacturing companies; known across the country for its brand name and reputation as one of the best. (Simchi-Levi, 2008) Giorgio Maggiali, the company director of logistics has acknowledged that company is experiencing manufacturing and distribution system fluctuations in demand. In 1988, the previous director had suggested using a just-in-time distribution system. The system was never implemented, but with the issues the company is having, he now finds that this idea needs to be considered and possibility put into action. Before Barilla can consider the just-in-time distribution system he needs to get answers to the following questions.

* What are the reasons for the increase in variability in Barilla’s supply chain?

* How can Barilla cope with the increase in variability?

* What is the impact of transferring demand information across the supply chain?

* Can the Vendor Managed Inventory strategy solve the operational problems faced by Barilla?

* How can the supply chain meet conflicting goals of different partners and facilities?

Causes of Variability Increases

Barilla’s has been noting major issues in their company for a long time. Their inventory has been too high, they rely heavily on promotional discounts. The company lacks the needed communication with customer and forecasting tools. The company has been experiencing a long lead time causing problems with customer service. Because of poor record keeping, the retailers and distributors have over stocked their inventory. Barilla maintains over 800 different lines in just dry products alone, which could be causing an increase in variability. In order to attempt to fix these problems the amount of finished goods inventories were increased in order to meet the distributors demands, causing a buildup of inventory stored...