Analyzing Super Food's Logistics and Supply Chain Management Practices

This case study analyzes the logistics and supply chain management practices of Super Food, a multinational food manufacturer. It examines current transportation and storage methods, offering recommendations for cost reduction and efficiency improvements. The study also assesses the company's environmental impact, emphasizing the importance of ethical sourcing and sustainable practices, including the adoption of electric vehicles and local suppliers. Furthermore, it delves into ways to raise capital for new product development, particularly in the vegan and vegetarian food market. The analysis covers the current environmental impact of the organization's operations and maintaining an ethical approach to sourcing and manufacturing. The case study aims to provide strategic recommendations for Super Food to enhance its competitive advantage and ensure long-term sustainability.

Logistics and Supply
chain management

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Current transportation and storage practices and recommendation to Super Food............2
3. Current environmental impact of the organisation’s operations and maintaining an ethical
approach to sourcing and manufacturing...............................................................................4
2. Ways to raise capital for new product development..........................................................5
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Operations, Logistics and Supply Chain Management is defined as an area of practice
that are being undertaken by an entity. It duly oversees all the important activities as well as
management functions that are being adopted by an organisation as to effectively manage
organisation's complex operations in a well defined manner (Banks and Stanton, 2016). All these
are essential tasks that allow an organisation to effectively manage their activities related to
manufacturing, production, procurement and transportation. Organisation with the
implementation of certain effective principles, can ensure high competitive advancements while
ensuring timely delivery of finished products to customers. Present report has been prepare on,
Super Food. Company operate its functioning as privately-owned multinational manufacturer of
chilled, frozen and ambient food products. In this report, formative discussion has been made on
current transportation and storage practices of organisation along with formative
recommendation with the help of which company can able to save their cost and can further
conduct their operations efficiency while ensuring competitive market share holding in
marketplace.
MAIN BODY
Super foods is private organisation. This is established in 1999 and having the
headquarter in Hong Kong. This is multinational manufacturer of frozen, chilled and ambient
food products. They have the manufacturing facilities in China, Poland, Brazil, USA and
Thailand. The business was established at all these business from the existing business
operations of an organisation. Different number of outlets are have by this organisation in 32
different nations. This organisation is specialised in production of chilled and frozen ready
meals. All these are sold by the organisation under its brand name and on the name of its biggest
customers. The current range of product in which this organisation deals includes red meat,
chicken and seafood. The Ambient products of this organisation contains well known range of
dried herbs and spices. These are sold in the market in different sachets that can be taken at home
for the purpose of further use. All the manufacturing units of this organisation has the
responsibility about taking care of their own different processes like finances, human resources,
logistics and operations management. While talking about the packing materials then this
organisation made the contracts with local suppliers to provide the product in different market.
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The two different case studies are considered under this by organisation. In first one, focus is
provided over reducing cost and improvement of efficiency. The main aim behind this aspect is
about attainment of competitive position in market for the purpose retaining position in market.
Second one is about raising funds for market growth in vegan and vegetarian meals. They also
want to build separate facilities for the purpose of processing and manufacturing.
1. Current transportation and storage practices and recommendation to Super Food
Super Foods a privately owned multi-national manufacturer of chilled, ambient and
frozen food which offer different types of product range like seafood, red meat and chicken
recipes to customers. Mentioned below current storage and transportation practices is being
given in context with Super Food:
Transportation & Distribution
Food Carriers
It has been analysed that in carriers segment, Super Food use air freight as to transport
their fresh food. In this company ensure that their food items are protected from contamination.
In addition to this, it has been identified that company currently undertake use of air freight in
order to transport their fresh foods.
Recommendation: In this, Super Food is being recommended to ensure temperature-controlled
container transshipments in order to set temperature of food as per according to their
requirement. In addition to this, all tankers those who deliver raw ingredients like flour are duly
cleaned in set period of time. In this company can effectively able to save unnecessary cost by
setting temperature for food as per according to requirement. With the help of this, company can
not only be able to save their cost but, also can able to increase efficiency that significantly lead
towards higher profitability and competitive advancements.
Raw material procurement and Storage
Stock Control and Rotation
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In this segment, Super Food ensure that there is periodic stock reconciliation undertake
place at a set intervals. This is mainly done by company by making comparison of recorded and
actual stocks. In addition to this, company ensure that all stocks are checked in a regular basis as
to duly identify stocks those are expired, obsolete and retested materials.
Recommendation: It has been recommended to Super Food to analyse main cause of stock
discrepancies and further implement well effectively CAPAs as to effectively prevent recurrence.
By undertaking use of CAPAs, organisation can maintain their cost and conduct all of the
activities in cost economical manner.
Quality Systems
It has been identified that Super Food involved in distribution and storage of raw material
in a well efficient manner. Company duly incorporates best storage practices, quality risk
management, good distribution and management review. With the help of all these measures,
company can conduct their operations by ensuring high profitability.
Recommendation: This is recommended to senior management of Super Food to make sure that a
well efficient quality system is being adopted, resourced and maintained. In addition to this,
entity must ensure that authorities, roles and responsibilities are implemented, communicated
and defined in a well defined manner (Mangan, Lalwani and Lalwani, 2016). Along with this, it
has been evaluated that GDP and GSP is being effectively adopted as well as managed in order
to ensure satisfactory arrangements. As far as food products is being concerned, it is
recommended to company to store, distribute and effectively handle products as to maintain
product quality as per according to government standards.
In addition to this, by undertaking use of cost effective strategies company can conduct
their functioning in a cost effectual manner. Transportation methods like different modes of
transportation, best warehousing services and consolidate shipments are some of the cost saving
methods with the help of which company can able to conduct their operations. While in terms
with procurement of raw material company by effectively ensuring timely procurement of raw
materials from head office can efficiently able to ensure minimum material risk. This will help
company to conduct their operations in economical manner.
Thus, as per the above discussion it has been analysed that there are different types of
transportation and storage practices that are being undertaken by organisation as to duly operate
their organisational functioning (Christopher and Peck, 2012). With the help of some
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recommended measures such as cost effective strategies, Super Food can effectively able to
ensure cost efficient measure, as to operate their functions while ensuring high competitive
advantages in marketplace.
Currently this organisation is procuring their raw materials by using their own transportation
this levies the issue of excessive fixed and variable expenses. To undertake the procedure of this
self transportation, organisation has to spend over all transporting equipment and separate staff
who can manage this process. To initiate the cost savings in this organisation, it is recommended
to procure the transportation services for outside organisation. This will provide a benefit of low
costs as no transportation equipment will be required to buy and no additional staff will be
required. For storage as well, this company is facing issues due to high competition in the
market. All the new organisations and long established companies are providing high level
competition to Super Foods. According to the company policies, every department is responsible
for its own transportation and storage but no department is allowed to source ingredients or raw
materials outside the organisation. This policy leads to chaos in management as one department
has to deal with various functions which can easily be outsourced. In order to rectify this issue, it
is recommended to Super Foods that they should outsource warehouses where they can store
their finished products and raw materials. This recommended solution will help the company to
save their expenses of warehouse rent and staff members who are solely responsible to manage
the warehousing system.
It is also recommended to the finance department of this company to analyse cost and other
expenses which will be levied on the company when they outsource the services of warehousing
and transportation. By this way both the costs can be compared and the proposal which is having
low costs can be selected. It is also recommended to this company, to hire multi-tasking
employees who are able to do multiple things at once, by this costs of additional staff will also be
saved.
3. Current environmental impact of the organisation’s operations and maintaining an ethical
approach to sourcing and manufacturing
Environmental concern is important in nature for each and every type of organisation
irrespective to the nature of the operations. It is an obligation of an organisational management is
to adopt the approaches which are ethical in nature and have least impact over environment.
Currently, organisation deals in manufacturing sector of food products. They procure the raw
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materials from the different places and carry on the work of producing food items at different
nations of world. The source used by an organisation for transportation are different like air, road
and sea. All the different means have their own level of contribution to harm world environment.
This is because of carbon emission at large level in different nations. The main operations of this
organisation is depends over its logistics. They procure the materials, then manufacture and in
last deliver to their retails outlets. All such functioning performed with the help of transport only.
This results into creation of large amount of pollution that has direct negative impact over
environment. The negative impact of same will be seen in future upon whole organisational
functions along with its profitability. Society is not tolerable towards the negative impact of
business functions upon environment. They always looked towards the business organisations
that adopt measures which are environmental friendly in nature. They also like to buy the
products and avail the services provided by them. The reason behind this that they also feel like
their own contribution towards development of society and environment.
There are number of ways that can help this organisation in future to adopt ethical
approaches of operating business functions, specially in the field of logistics. Such different
number of ways are defined below:
 Adoption of electric ways of transportation: This organisation is must focus over the use
of electric vehicles. This will help in reduction of carbon emission along with saving of
non renewable resources of world. The use of electric transport not only help to protect
the environment but also enables the organisation in reduction of their costs. The two
benefits will be adopted by this organisation that improve its competitiveness in market
allows to hold large market share.
 Procure from the local suppliers: This organisation has manufacturing activities in
different nations. Also, they took raw materials from head office. The way that help in
reducing transportation that procure food items from the local suppliers. This step
indulging less number of transportation activities and automatically contributes in
reduction of environmental impact
 Own self production: This is the best option to get rid of the situation of transportation if
all the manufacturing units builds their own self production required food items. This
eliminates the situation of transportation and aid in reducing the negative impact of their
operations over environment.
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 Reducing emissions: Through the market research, it has been observed that customers of
Super foods are ready to an additional price for the products if those products are
manufactured and procured using sustainable mediums. Logistics and supply chain
management of this company has involved various interlinked due to which the activity
of transportation is highly necessary. In order to reduce the emissions which are produced
through this transmission, this company has two options. They can either procure
outsource transportation and logistics services from external parties which use green
mediums such as electric vehicles and non pollutant gases. Or Super foods should invest
heavily on their logistics system by implementing green logistics system, by which they
can gain long term profits and satisfaction of customers.
 Reducing the amount of energy: This is another recommendation which Super foods
should consider to implement in their functions. This company is a large scale company
and it is important for the management of this organisation to sustain their manufacturing
process by reducing the amount of energy which is used in the process of producing the
food products. This company can use the machines which require less energy and steps of
energy optimisation must be used.
 Reducing wastage: Super foods is a food processing organisation which processes food at
a large scale. This company is recommended to use measures by which their raw material
wastage can be reduced. For this purpose, company can implement quality control
techniques such as reduce and reuse and total quality management by which waste can be
reduced and the low amount of waste can be reused.
 Change in organisation policies: From the case study of Super foods, it has been observed
that every manufacturing unit of Super foods are located at distinct locations such as
China, Poland and USA. All these manufacturing units have to procure ingredients from
the head office of China which increasing the activity of logistics and transportation
which is the main reason of enhanced emissions and use of energy. It is recommended to
this company, that they should change their organisation policies and let all
manufacturing units to procure ingredients from local suppliers by which quality of the
products can be maintained and logistics system can be sustained.
All the above recommendations can be used by Super foods to sustain their operations by
which they can acquire the competitive advance over the competitors. By using these
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recommendations, carbon footprint on environment will also be reduced. Customers of this
company will be satisfied and the brand image will also be improved.
2. Ways to raise capital for new product development
Super food is skiing to raise amount of capital for expanding their business in existing
marketplace. Company decide to expand their business by producing vegan and vegetarian
meals. As it will support them an organisation that will be beneficial for an organisation in
development of its growth and success in marketplace. Along with this, company wish to build
individual facilities for processing as well as manufacturing vegan and vegetarian products. In
order to manufacture and innovate these products, Super food require accurate amount of capital.
For this company need to searching best sources of fund. There are number of sources of fund
which are personal investment, Angels investors, Bank loans etc. These are consider best sources
of fund that would be beneficial for Super Food for processing and manufacturing vegetarian and
vegan products. These sources will be explained as below in detailed manner along with their
benefits and drawbacks. These are:
Retained Profits: It is an approach in which some section of the income is retained
specifically with a means to fund future investment undertaken by the organisation. The profits
in this case are generally not paid to shareholders and are utilised for growth purposes. It is very
essential for a business to utilise the retained earnings in an appropriate manner as they are
recorded in the balance sheet of the company under “Shareholders equity”. It is the obligation of
the top management to make sure that such sources of funds are properly utilised as they are
shareholders money. Under this scenario, Superfood can use the retained earning to fund their
upcoming venture of product expansion.
Angel Investor: These are referred to individuals who invest heavy amount of funds in an
upcoming venture. These individual carry large sum of funds with themselves and are looking
for investment opportunities that may provide higher share of return. The average amount of
return which an angel investor expects is around 25%. It is the form of equity financing which
attempts to fill in the gap between the small-scale financing provided by family and friends and
venture capitalists
Bank loans: Banks are consider as a supermarket of debt funding and financing. They
give long term or short term funding, and they fund all asset, including real estate, equipments
and working capital. There are some advantages and disadvantages of bank loan which will be
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beneficial for Super food in processing and manufacturing these products. One of the main
advantages of bank loan as it drives the growth which will be more essential for company in
expansion of its business. This source of fund will also provide capital for regular operations.
Along with this, interest on the borrowed amount maximise additional burden on the borrower.
Therefore above mentioned all these are main sources of fund but for Super food, bank
loan is one of the best and valuable source. There are certain advantages of bank loan which are
driver of growth, flexibility, purchase without liquidity, better interest rates, cash discount,
ownership remains with borrower etc. These are consider main advantages of using bank loan.
As it will support Super food in expansion of vegan and vegetarian products in existing
marketplace.
Ansoff matrix
It refers to a marketing planning tool that describe a product and market growth in a
business. It is also known as a product development matrix that was invented by H. Igor
Ansoff . It includes four strategies such as product development, market development, market
penetration and diversification strategy that is used to grow the business and analyse the risk
associated with that strategy. This matrix helps the business to analyse the risk at make it
opportunity so that the company earn more profits and increase market share. Manager of
superfoods can used this matrix to analyse the growth of their business in future that are as
follows.
Market penetration- The main focus of this matrix is to increase the sales of current
product in existing market. In this strategy the main aim of business is to increase the market
share by selling their existing offering in the current market place. It is less risky because in this
product and market both are known for the organisation. This is used at different ways where
industry lowers the pricing of their goods, using various promotional methods like social media,
television, billboards etc. In context of superfoods, manager could use this strategy to increase its
market share by selling their existing product offering in the market. It will encourage the
initiative to increased the usage of the product. To increase the sales for their current goods firm
use various strategy like decreasing the price to attract more and more customers, encouraging
promotional activities, acquiring a rival firm in the same industry.
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Market development- In this strategy firm target customers in new market with their
existing products. This strategy help in grow the market share in different and new market but
with the current offerings. In this matrix business expand in new geographical location,
consumer segments, regions etc. It is successful in some conditions like if the customers in a
new location is profitable, user behaviours are in the favour of the firm. Manager of superfoods
company could use this strategy when they expand their business in new geographical location.
For this company use various advertising methods to attract wide range of customers in a very
small time. This strategy is more risky than the market penetration matrix because in this firm
enters in the new market with its existing product and there is a fear of successfully operates a
business in the new area. This strategy can be use in several ways where superfoods operates
their business in new domestic market or enters into the foreign market. For this they needs lots
of capital as well as they need to examine the culture and values of that country if they establish
their business at global level.
Product development: It is the effective strategy of expansion which includes
development of the new product in the existing market. The strength of this strategy is to
encourage a customers with new product that was launch by superfoods company i.e. vegan and
vegetarian meals. The main benefit associated with this strategy is about attraction of potential
customers towards the business activities and the usage of their existing brand image in effective
establishment and attraction of customers. It helps in increasing the market share, maximise
profits and increase growth of the firm.
Diversification: It is an effective growth strategy that helps an organisation in
development of its product and improvement of its market growth. For this strategy, company
become more able to produce new products and services in new market. As it will help an
organisation in development of its growth and success. In context of Super Food, diversification
is not a suitable and appropriate strategy for an organisation. Super food wise to processing and
manufacturing vegan and vegetarian products in existing market. As according to the case study,
diversification strategy of growth is not useful and appropriate. Along with this, such type of
strategy is not much appropriate for company in development of its products successfully in
existing marketplace. In addition to this, if Super food require to expand their business by
launching a new products and services in new market, diversification is most useful and valuable
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strategy. As it support them in development of its products in marketplace and also support them
in its growth and success.
The new area where organisation wants to develop the product is vegan. This is so because
of the high demand of nutritional food in market. Health conscious people are exist are exist in
all over the world. Youth is much more focused in this direction. This will become the good
target segment that help to grab the market opportunities along with market share. This will also
help to improve the image along with attainment of competitive advantage in market against to
all the different players. This will improves the scope of the organisations food operations as
covers diversified nature of people reside in society along with belongs from the different age
category. The aim of sustainability will be achieved in easy and short period of time. So, it is the
perfect option for an organisation to adopt for expansion in market.
CONCLUSION
As per the above mentioned report it has been concluded that, operations, logistics and
supply chain management acts as one of the most important element within an organisation that
are required to be consider by an organisation in order to ensure high profitability. Company by
taking use of temperature-controlled container transshipments, GDP and GSP can operate
their functioning in signifiant manner. In order to overcome pressure, it is essential for an
organisation to reduce their cost and increase efficiency in order to conduct operations of
organisation in a well defined manner. Further there are different types of strategies and policies
with the help of which organisation can save their cost. With the help of this, company can
significantly able to ensure high profitability and productivity.
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