Food Marketing (MKG 721): Evaluating Bru Coffee's Supply Chain

This presentation provides a comprehensive analysis of the Bru coffee supply chain, examining its various stages from raw material sourcing to consumer delivery. The analysis includes a detailed mapping of the supply chain, highlighting the roles of manufacturers, wholesalers, retailers, and consumers. A SWOT analysis is conducted to evaluate the strengths and weaknesses of the supply chain, alongside an assessment of the macro-environmental factors (PESTEL) impacting its operations. The presentation also explores how the company leverages its strengths to mitigate weaknesses and capitalize on opportunities. Recommendations are provided to improve the supply chain's efficiency and effectiveness, with a focus on integrating ERP systems and enhancing vendor performance monitoring. The conclusion emphasizes the importance of a well-managed supply chain and how focusing on its strengths can enhance distribution networks. The presentation is based on the assignment brief for MKG 721 Food Marketing, focusing on the emerging food sector and making recommendations for supply chain improvements. The presentation includes an executive summary, introduction, mapping of the supply chain, evaluation using SWOT, macro-environmental factors, conclusion, and recommendations. The presentation utilizes tables and diagrams to present the information and includes citations for all sources.

1
Food
marketing
(“BRU” COFFEE`S SUPPLY CHAIN)

2Table of Contents
Particular Page number
Executive summary 3
Introduction 4
Mapping of a Supply Chain 5
Info graphic 6
Supply chain process 7
Wholesaler 8
Retailer 9
Customer 10
Sales graph 11
Strength of Supply chain 12
Weaknesses of supply chain 13
Macro-environment 14-15
Strengths Leverage Opportunities 16
Weaknesses of supply chain 17
Recommendations 18
Conclusion 19
References 20-21

3Executive summary
 With the rapid changing business environment, a
business has to adopt efficient supply chain.
 The presentation brings out a supply chain of “Bru”
coffee.
 Coffee`s supply chain attempts to create an
vertically integrated channel from manufacturer to
wholesaler to retailer to consumer.

4
Introduction
 The supply chain of “Bru” coffee manages the
flow of coffee beans from the farmers to
customers for the final consumption.
 The aim of analysing supply chain of “Bru”
coffee and evaluate supply chain through SWOT
analysis.
(Source: AIIMS, 2018)

5
Mapping of a Supply Chain
Supply chain is the network of activities
which plan, adjust and execute the
product flow from grabbing the raw
materials till final distribution to
customers in an cost effective manner
(Kissinger, 2017). The importance of
supply chain are-
 Supply chain optimises the operation
of the organisation in order to
maximise the speed and efficiency.
 Effective supply chain can provide
competitive advantage to the
organisation because of faster order
delivery.
(Source: Perepa, 2014)

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7
Supply chain process
Manufacturer
 “Bru” coffee derive it’s raw coffee beans through best Arabica
and Robusta beans from the best South Indian plantations
(Unilever, 2018).
 The coffee brand “bru” indulge in integration of contract
farming with coffee beans suppliers.
 The coffee brand authorises a third party to undertake its own
manufacturing units.
Manufactur
er Wholesaler Retailer ConsumerManufacturer

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A wholesaler purchases large quantities of coffee
and sell them in small quantities to the retailers.
A wholesaler maintains a stock keeping unit,
satellite warehouse, and depot facilities to store
coffee packets.
The Unilever`s coffee “Bru” hires merchant
wholesalers, brokers, and agents to provide full-
time service through industrial distributors.
Manufacturer
Wholesaler
Retailer
(Source: study.com, 2018)

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Retailer
 “Bru” retailer uses customer distribution centres such as
independent brokers, co-operative and independent
grocery businesses.
 “Bru” collaborate with local retailers to develop Bright
Future project.
 BRCC Enactus partnered with local retailers to serve the
customers. For example- Initiates such as Shakti
enterprises and super value stores have been initiated to
serve the people in both rural as well as urban areas.

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Consumer
 Finally, the coffee reaches to its final
consumption level to the customers.
 The brand “Bru” has a wide range of
conventional coffee such as ice coffee,
gold coffee, instant coffee, hot coffee,
and cappuccino.
 Apart from retail services, the brand
also has its vending machines in
supermarkets which provide Coffee.
(Source: Sell more online,
2018)

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1
Sales graph
Revenue from coffee
(Source: Know your grinder, 2016)

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2Strength of Supply chain
Strength
“Bru” has a well-established distribution channel as it is the brand
product of Unilever which has an unmatched strong distribution
channel.
Company has decided to provide vending machines for hot
beverages like tea and coffee, which help it to reach every
maximum customers (Ntabe et al., 2015).
The widespread distribution channel of “bru” coffee assists the
company to maintain favourable trade relationships, provide
incentive to retailers and organise demand generation plans.
Unilever operates 306 manufacturing units in 69 countries.
Unilever`s maintains and operates a chain of 400 warehouses. A
large number of warehouses are maintained by central system of
control towers that improves customer services and reduces costs.

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3
Weaknesses of supply
chainWeaknesses
Unilever`s supply chain lacks forward integration which leads to
overdependence on retailers. Due to overdependence on retailers,
the company looses its direct influence on customers (Blanchard,
2009).
Despite of its strong market position, the company is unable to find
wholesalers and retailers in rural areas. With less number of retailers
in rural areas, the company is not able to reach its potential
customers.
Although the demand of rural and semi urban population is growing
but the main problem with distribution is improper logistics
management.
It caters huge audience and distribute coffee through C&F agents and
several retail outlets but still it is unable to reach millions of
customers in rural area.

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4
Macro-environment
Macro factors (PESTEL) Affect on supply chain
Political factors Political elections and massive strikes
minimise the pace of global operations of
a company.
Environmental factors Typical supply chain focuses on reducing
the cost and serving higher quality. The
introduction of extended producer
responsibility has changed the ,market
behaviour. The manufacturing units have
to undertake the post-consumption
phase of an product. Organisations are
forced to follow ecological practices to
meet the legislative requirements.

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5
 .
Social factors Social factors which are involved at
manufacturing level is less use of
chemical during the manufacturing
process. Social responsibility towards
suppliers and retailers have become
major concern to consider their safety
issues and other risk assessing factor
(Mokhtar et al., 2018).
Economic factors The improper infrastructure in the rural
areas do not allow equal and adequate
distribution of coffee in the whole country.
Legal factors The fluctuating prices of fuel costs
increases the cost of marine and land
transport. Government imposes outbound
operational policies such as octroi and toll
tax that restricts the supply of coffee in
certain areas (Guo et al., 2016).

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6Strengths Leverage
Opportunities
 Unilever already provides an variety of coffee
such as Bru gold, Bru instant to customer. It also
avails filter coffee such as Bru green label and
Bru select.
 As Unilever has widespread distribution channel.
Hence, it can gain a understanding of demands of
different customers (Gopalakrishnan, 2015) .
 The coffee brand “Bru”can use its extensive wide
distribution centres by integrating VMI (vendor
managed inventory) programs to improve the
demand plan.

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Strengths Minimise
Threats “Bru” has an strong distribution channel which
penetrates the basic lifestyle of consumers which
minimises the threat of competition in the industry.
 “Bru” supply chain has an competitive advantage
over other coffee brands because “Bru” has become
national and international player among the coffee.
 An high performing supply chain which creates
value additions in its supply chain to serve rural
people efficiently minimise the risk of entering new
competitors.
 A large number of operational houses with similar
number of warehouses in each area minimises the
risk of dynamic nature of demand.

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8
Recommendations
 Rather striving for retailers in rural areas, “Bru”
should introduce ERP software among rural and
semi-urban people.
 Every company has own managers to identify
some innovation partners to spread its distribution
channels to every corner of the country.
 ERP systems can complement SCM (supply chain
management) functionality which feature
automatic purchasing.
 The coffee brand “Bru”should undertake and
monitor the vendor performance for coffee to
review vendor cycle and error rates.

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Conclusion
 Strengths of supply chain depend on the
efficiency of the company to manage its
distribution channels.
 Macro- environmental factors have both
positive as well as negative impact on supply
chain operations.
 Focusing on the strengths of supply chain
rather than weaknesses can enhance and
widen the distribution channel network.
 The recommendations strive to improve the
quality of supply chain by applying ERP
software.

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Guo, C., Liu, X., Jin, M. and Lv, Z. (2016) The research on optimization of auto supply chain
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105-114.
Gopalakrishnan, G., (2015) How to apply academic supply chain management: The case of an
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207-221.
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