Strategic Supply Chain Management for Starbucks Singapore

Running Head: Supply Chain
0
STARBUCKS SINGAPORE
Strategic Supply Chain Management
7/18/2019

Supply Chain
1
Contents
Introduction......................................................................................................................................2
Supply chain management analysis and evaluation.........................................................................3
Tools used by the Starbucks............................................................................................................3
Literature review..............................................................................................................................4
Proposed models..............................................................................................................................7
Critical evaluation............................................................................................................................8
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

Supply Chain
2
Introduction
Starbucks in Singapore was founded in 1988 which offers the highest quality of coffee to
its customers. In 1996, they have opened their first outlet (Cachon and Fisher, 2000). They also
provide a range of exceptional products such as merchandise, coffee, handcrafted beverages,
fresh food, etc. The main objective of this assignment is to build a connection with the customers
by providing them the best results. The purpose of this assignment is to evaluate the supply chain
management of Starbucks and finding new ideas to grow. In this report, the proposed model and
the theories of the supply chain will be explained.

Supply Chain
3
Supply chain management analysis and evaluation
Goals and challenges: The goals of the Starbucks are that “one person one coffee” and
they want to establish their brand as the finest coffee in the world. The main goal of the company
is to serve the finest coffee in the world. The major goal is to make the growth of the company
by providing the premier purveyance. There were certain challenges which were faced by the
Starbucks such as the food has been the challenge for the Starbucks as they are a major coffee
producer (Tate, et al., 2010). The biggest challenge which they faced is the price, as they charged
the premium price from their customers. In terms of the supply chain, they face the issue relayed
to the relationship between the customers and the baristas as they do not make any good
connection with each other. Another challenge which the Starbucks Singapore was facing is the
loss of the warm feeling in the store and the coffee aroma.
Effective supply chain: The supply chain of the Starbucks is vertically integrated which
is indicating that the supply chain of the company is involved in every process of the supply
chain process (Sukarmijan and Sapong, 2014). The current supply chain of the Starbucks
includes the way from the coffee ban to the cup of coffee which is sold to consumers. The supply
chain of the Singapore Starbucks is effective as they interact with farmers and ensures that coffee
beans which have received from the farmers are of the same quality and flavour. In the supply
chain of the Starbucks Retailer and the Distribution, the centre plays the major role as they
manage all the supply chain networks such as the transportation, inventory management, material
handling, order processing, and reverse logistics.
Tools used by the Starbucks
EOQ: This tool is used by the company for materials like milk, coffee cups, coffee cakes,
and espresso. This system is used for the company to maintain an adequate level of the stock.
The Starbucks used this tool so that they can always maintain the stock more than the 10 % for
the adequate level of the stock so that the demands of the customers can always meet up (Ken
Boyer, 2013).
P System: This system is used for the company for material like coffee beans, water
bottles, etc. This tool is very effective as it helps in managing the audit inventory level at the