Discussion About Kellogg's Case Study

Discussion 1:

I have been eating Kellogg's cereals since ten years and i love them. I always thought that the company just produced the cereals and simply distributed them to countries all over the world. In other words, I did not have any idea about its Supply management. After reading the case, I learned that it worked with many retailers like TDG, ASDA and Kimberly Clark to stock its products and improve its distribution. I realized that as a result of its relationships with other business's it spent less money through the supply chain and focused more on its manufacturing. All in all, unlike I thought before now I know that Kellogg's processes are very sophisticated.

Discussion 2:

Unfortunately, nobody cares about our environment. More harmful substances are thrown to the environment everyday and many companies are included this act. Before reading the case study, I thought that Kellogg's was like the other businesses too. I said to myself "Their cereals can taste good, but I am sure that they harm the environment. However when I read the case, I became aware that Kellogg's manufacturing methods were based on producing the less waste. Now I have no doubt that this company is sensitive about our environment and is in a struggle to protect it.

Kellogg's Case Study Questions

1)Name the three sectors of the supply chain. On what occasions could certain sections of-the primary sector operate as retailers?

The three sector of Kellogg’s supply chain are primary (extractive), secondary (manufacturing) and tertiary sector. Some raw material sections of the primary sector could operate as retailers. For example coal can be sold to power stations. In addition oil, wheat and corn can also be sold individually in order to act as retailers.

2) Give three examples of how Kellogg’s demonstrates good supply chain management.How can Kellogg’s make improvements both for its business and for the environment?

Kellogg’s uses a range of agencies and departments for research, quality, purchasing, sales, transport and distribution to manage the supply chain more effectively. It tries to manufacture the right products by doing a research on customer needs. The company also focuses on cost-effective systems in order to ensure that its prices are competitive. Another management of Kellogg’s supply chain is that it works with retailers to improve promotion of its products. Kellogg’s can make improvements for its business and also for the environment by focusing even more on its production methods to increase their outcomes and to reduce the produced waste from the production process that is harmful for the environment.

3)Why is it important for Kellogg’s to build good relationships with businesses in the tertiary sector?

Building good relationships with businesses in the tertiary sector makes it easier for the business to focus more efficiently on its specialist are which is to manufacture cereals and other food products. As an example, Kellogg’s works with Kimberler Clark to get transportation. This results in a decrease in Kellogg’s distribution costs thus makes its products more competitive. Evenmore, relationships with other businesses also helps to reduce the number of part-full or empty vehicles on the road so all of the products can be reached to a certain place at the same time. The importance of this is that it saves time, road miles and less gas is used which saves Money. All in all, building good relationships in this sector results in an increase in turnover for Kellogg’s.

4)Evaluate the benefits of large manufacturers like Kellogg’s handing over the logistical side of their business to specialist companies like TDG.

The most important benefit of Kellogg’s collaboration with TDG is that it increases the efficiency of Kellog’s distribution system. Kellogg’s distribution is based on a system called “just-in-time” and TDG makes this system work properly. TDG uses computerized stock holding systems which shows immediately when then the shelves in the ware house are empty. So the shelves are always kept full and orders are delivered on time. This helps Kellogg’s to keep stocks to a minimum and prevents unnecessary expenses. Another benefit is that TDG keeps the warehouse costs low through its specialist transportation systems. This also prevents Kellogg’s to make unnecessary payments. In addition, working with retailers such as ASDA and Tesco benefit as they store the products witgout storage costs.