Supply Chain Management of Highland Coffee

Supply Chain Management of Highland Coffee

Table of Content
1. Introduction
1.1 Theoretical explanation of Supply Chain Management
1.2 Quick view of Highland Coffee
2. Discussion
2.1 Highland Coffee’s Stage of Supply Chain
2.2 The Key Success Factor of Supply Chain Management in Highland Coffee
2.3 Recommendations or suggestions for improvement of Highland Coffee’s
Supply Chain Management for further business
3. Conclusion
4. Reference

What is Supply Chain Management and how Supply Chain Management works?
Supply chain management is the administration of the stream of merchandise and
administrations and includes all forms that change raw materials into final products. It
includes the dynamic streamlining of a business's supply-side exercises to maximize
client value and pick up a competitive advantage within the marketplace. SCM
represents an effort by providers to create and actualize supply chains that are as
efficient and conservative as possible. Supply chains cover everything from generation
to item advancement to the data frameworks required to coordinate these undertakings.
According to Robert Handfield, Supply chain management (SCM) is the active
management of supply chain activities to maximize customer value and achieve a
sustainable competitive advantage. It represents a conscious effort by the supply chain
firms to develop and run supply chains in the most effective and efficient ways possible.
Frequently, the SCM attempts to centrally control or communicate the creation,
transport, and dissemination of a product. By managing the supply chain, companies
can cut excess costs and deliver items to consumers faster. This can be done by having
stricter control over the company's internal inventory, internal arises, dispersion,
transactions, and the company's inventory.
About Highland Coffee
Highland Coffee is a very famous Vietnamese coffee shop. Highland mainly about
tradition Vietnamese Coffee that collect from highland province and serve with Cake or
Banh Mi to give the customer the best meal and snack. Highland also have a organize
activities methodically so that they can globalize their brand all-over South-East Asia.
From the love to Vietnam and the passion of coffee, in 1999, the brand-named

Highlands Coffee® was born with the passion of raising the café heritage of Vietnam
and spreading the spirit of Viet pride, connecting harmoniously between tradition and
modernity. Originating as a packaged coffee business in Hanoi in 2000, we’ve quickly
grown into a chain of well-known coffee shops that have been expanding throughout
Vietnam and abroad since 2002 (Highland Coffee, 2018)
Highland Coffee was invented by David Thai in 1998. In the late 1980s and early 1990s,
David Thai, the company's founder, witnessed the rise of the Starbucks coffee chain
from a little company in his hometown of Seattle to a multinational organization. He later
cited this as the motivation behind the establishment of Highlands Coffee, which first
started operation in Hanoi in 1998. The company's initial enlistment marked the first
time an Overseas Vietnamese individual was able to register a private company of any
kind in Vietnam. Two years later, in 2000, the company was enrolled as a joint-stock
company, again a first for an Abroad Vietnamese.
Highland Coffee’s Stage of Supply Chain
A company which observed as very successful in building a complete and sustainable
supply chain system in Vietnam is Highland Coffee. It is also well-known as the pioneer
in bringing Vietnamese coffee to the world and one of the leading brands in Vietnam.
The supply chain built by Highland Coffee very reliable and stable in term of linking
between the nodes in the network. Neuhaus Neotec a very famous company in coffee
manufacturing industry has a very important role as it is equipment supplier for the
factories.

Supplier: Highland Coffee collect coffee directly from nearly 1000 coffee farms all over
Vietnam. Especially from Highland topographic where the coffee bean nurture in the
best condition. Raw materials (coffee beans) are purchased from several sources such
as farmers, private companies, merchants, and collectors. The farmers in this supply
chain have been shared the technology and information in developing coffee by
Highland Coffee. For traders, Highland Coffee has its own standard in selecting the
reliable traders.
Manufacturer: The raw materials are delivered to Highland Coffee industrial facilities by
trucks for processing. After being decaffeination, mixing, roasting, pounding, and
transformation to become a finished product, coffee will be packaging into bags and
boxes. Then the boxes and bags will be once more transported by trucks to Highland
Coffee distribution centers for categorizing and distributing to its clients.
Retailer: Highland Coffee items will be reviewed by the inspection center in Vietnam
before exporting. After arriving foreign and local market, the items will be once more
inspected before distributing to final consumers. Highland Coffee product reach final
consumers through supermarkets, retail stores, coffee shops, and wholesalers.
Customer: The customer will purchase the final product and review about product
quality.
The Key Success Factor of Supply Chain Management in Highland Coffee
Several key success factors exist for Highland Coffee, a leader in the Vietnamese coffee
industry. They include marketing, expansion, innovation, recruitment and training, and
brand/image/experience.

Marketing: Highland Coffee at first positioned itself within the advertise by utilizing high
quality and large variety. Their quality is in competing on quality and comfort instead of
convenience. Starbucks craftily made a space for customers to enjoy a cup of coffee
away from home or work.
Expansion: In order to proceed with development and maximize profits, Highland Coffee
will engage expansion efforts in both Vietnam and worldwide markets. the quality of
Highland Coffee product will make Vietnam famous.
Innovation: Highland Coffee smartly realizes that innovation will allow it to preserve the
upper hand within the coffee industry. Last year, Highland Coffee presented a modern
mix of coffee to attract more customer. And it was a great success for company.
Recruitment: Highland Coffee is known for giving their workers incredible benefits, such
as health coverage and parental leave, among other things. Part of what makes Highland
Coffee one of the most excellent companies to work for the benefits they offer employees,
the collaboration that comes with the work, and awesome supervisor and partner
connections.
Training: Highland Coffee has a very special training method to created great
employees. Employees could learn about the history, confrontation challenge and social
skills to deal with customer. And in Highland Coffee, everyone respects each other so the
employees didn’t feel pressure when they make a mistake.
Recommendations or suggestions for improvement of Highland Coffee’s Supply
Chain Management for further business

Businesses often define their exercises in terms of household and trade deals. This may
be a limited and restricting view. Limited firms also define their coordination and supply
chains in terms of freight, distribution center, and other costs. They fail to get how much
their clients and businesses are affected by supply chain administration. Best hones in
SCM lead to the development and thriving. In any case, regularly the result of all this
nearsighted considering is that these firms trap themselves into being characterized as
a product item supplier where cost is the key differentiator with the competition. Leader
firms know that orders whether they are recharging, client or new products and must be
delivered complete, precise and on time. Just like Highland Coffee, when they launching
a new type of drinks, chairman has used a very clever way to marketing and guarantee
the quality of the product is as good as advertisement to attract more customer. So,
these are Supply Chain Management Best Practices for Highland Coffee:
Increase inventory speed. stocks must move quickly; turns should be high. It must
pass from the supplier or the local production to the customer. Becoming rich and
lacking cash is not the right approach. This is especially for items A and multiple items
B. Products in stock are as restricted as possible.
Implement lean coordination/supply chain administration. Incline logistics
complement supply chain administration. Both emphasize pulling, not pushing, items
through the supply chain. Both recognize-and inclines remove--the squander made by
excess inventory and time and the require for provider performance.
Improve supplier performance. Success starts with provider performance. Highland
Coffee must deliver quality items and do it complete, accurate, and on time.

Collaboration is important. Whether the items are wrapped up merchandise or materials
for production lines, the requirement for strong supplier execution is there.
Compress cycle time. Cycle time runs from the time the requirements for a product-
now or replenished-is determined and goes until it is delivered to the client or to the
Highland Coffee store. The length of worldwide supply chains includes the challenge.
Overall, Highland Coffee is a very good company manipulating their supply chain.
Integration of the activities will help Highland Coffee s to attain their targets. This
integration plays a significant role within the entire Highland Coffee’ supply chain.
Highland Coffee builded long-term connections with suppliers, disposal of deterrents to
cooperation, setting up common goals and devices for participation, techniques, and
strategies, analysis, and sharing of data by all supply chain participants. Such activities
at the starting of the chain would be the work with coffee producers on development
practices that progress coffee quality and give consistency and progression, allowing for
paying premium costs to producers which then contribute to making a sustainable
source of coffee beans.
Reference
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