Case Study Barilla Spa

BARILLA SPA(A)

Executive Summary

Barilla is a family owned, world’s largest pasta manufacturer founded in 1875 by Pietro Barilla in Parma, Italy. Barilla has grown multifold from a small shop to a big integrated corporate organization with state of the art pasta and bakery product manufacturing facilities. Barilla was sold to W R Grace in 1971 owing to a debt on the organization because of its expansion plan in Pedrignano, only to be bought back by Pietro Barilla in 1979. Barilla differentiates from its competitors with a high quality product supported by innovative marketing programs. The company enjoyed an annual growth rate of over 21% in the 1980’s. By 1990, Barilla became the largest pasta manufacturer of the world with market share of 35% of pasta sold in Italy and 22% sold in Europe. The company is organized in seven division, three pasta divisions, bakery product division, fresh bread division, catering division and international division. Barilla owns and operates with an extensive manufacturing network located at 25 different locations across Italy. All the plants manufacture a particular set of product and have the advanced state of the art facility ensuring the best quality product is manufactured. To keep the changeover costs low and product quality high, Barilla follows a carefully chosen production sequence that minimized the incremental changes in the kiln temperature and humidity between the pasta shapes. The entire product range at Barilla is divided into two general categories: Fresh products which have 21 day shelf life and fresh bread that has one day shelf life and Dry products that have longer shelf lives. Out of Barilla’s total sales, 75% is of Dry products. The Dry products are offered in 800 different SKU’s and pasta is offered in more than 470 different packaged SKU’s. Most of the products are distributed from the central distribution centers (CDC) located in Pedrignano and Naples. Barilla maintains two separate distribution...