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B207: Question 2 Starbucks Supply Chain (Roasting Plants (Central…
B207: Question 2 Starbucks Supply Chain
Plantations
Latin America
Asia
Africa
Roasting Plants
Regional distribution centres
USA
5 company-owned
3 T/P logistics
Coffee beans
Roasted & packaged
Central distribution centres
Non-coffee products
Mainly T/P logistics
2 in Europe; 2 in Asia
Downstream: partial integration
2008 onwards
Restructured supply chain
Concentrate on needs of consumer
Simplification
Reduce bullwhip effect
Outsourcing causing costs to escalate
Why did they outsource?
Rapid expansion
Resulted in loss of control
Hybrid system
Contractual relationship with external suppliers
Chosen for distinct capability
Type III
Significant level of operational integration
Lambert's categorisation
Vertically integrated re roasting plants
Quality control
Strategic decision - maintain control of core component
Economies of scale
Cost control
Scheduling control
Ford River Rouge
Upstream integration
Joint Venture
Tata Global Beverages