Logistics and Scm

For COVER PAGE

Table of Contents

Introduction 3

1.1 Brief Company Overview 3

1.2 Speciality Coffee Industry and Starbucks Coffee Supply Chain 3

1.4 Problem Definition 4

Literature Review 4

2.1 Current Situation of Starbucks and Older Supply Chain Method 4

2.2 Supply Chain Visibility 5

2.5 C.A.F.E (Coffee and Farmer Equity Practices) Practices 6

Findings 7

3.1 Starbucks’ Operations 7

3.1.1. Material Flow 7

3.1.2 Purchasing System 9

Discussion and Analysis 10

4.1 Starbucks’ 3PLs Strategy 10

4.2 Value Change Analysis 10

Conclusion 11

Appendix A 15

Appendix B 16

Appendix C 17

Appendix D 18

Appendix E 19

Appendix F 20

Appendix G 21

Appendix H 22

Appendix I 23

Introduction

1.1 Brief Company Overview

Starbucks is the world’s #1 speciality coffee retailer with more than 20,000 stores n 65 countries (See Appendix G). It operates an estimate of 8,800 of its shops, while licensing and franchises operate the remainder of the stores. The company also owns Seattle’s Best Coffee, Torrefazione Italia coffee brands, Teavana, Tazo, Evolution Fresh, and La Boulange (SCC 2014). Starbucks offers consumers various products including: coffee, handcrafted beverages, merchandise, fresh food, and consumer products of coffee and tea and ready-to-drink (RTD) goods (SCC).

1.2 Speciality Coffee Industry and Starbucks Coffee Supply Chain

The speciality coffee industry has seen drastic growth with increase in sales between the 1980s and 1990s. A great number of coffee specialists believed that differentiated coffee supported by the speciality industry would continue to expand at a faster rate than conventional coffees. However, by 2005, the actual definition of speciality in the U.S. refined and included less quality and flavoured coffees (Blumenthal 2008).

The coffee bean product is exported globally from countries in East Africa, Pacific Rim and Latin American. About 50 to 70% of the global coffee supply comes from small scale farms (composed...