SUPPLY CHAIN MANAGEMENT

Heineken's Supply Chain Management

Heineken's Supply Chain Management

Traditionally, it took Heineken 10 to 12 weeks to deliver beer to its distributors in late 1995, the company decided to implement a supply chain management system to reduce the delivery time to between four and six weeks. (Weston, 1997)

Using Logility's CPFR-compliant Voyager, the first airplane to circumnavigate the earth non-stop on a single load of fuel. Designed by Burt Rutan and flown by Dick Rutan and Jeana Yeager, Voyager took off from California on a brand name for certain models of Inspiron laptops from Dell.  Software and the internet, Heineken has implemented a private network connecting the company to customers and suppliers. The system can also connect salespeople. (Lee, 1997)

Persons who are employed to sell merchandise in a store or in a designated territory to the central database. Heineken is using the system to do real-time forecasting, ordering, and replenishment with its distributors Through CPFR, distributors can log in and view their sales forecast.

A key input to a firm's financial planning process. External sales forecasts are based on historical experience, statistical analysis, and consideration of various macroeconomic factors then modify it and submit orders online. The system has helped the, company reduce order cycle times from three months to four weeks. Other benefits include lower procurement cost, smaller inventory, and fresher products to consumers.

Heineken is one of the largest breweries in the world, generating sales of €11.8 billion in 2006 and brewing more than 10 billion litres of beer. An interesting twist in their massive operation is that they take back millions of reusable packaging items (bottles, kegs, crates) from their customers — a complicated and expensive task.

The process of taking products back from the market is known as reverse logistics, and it's gaining more attention as an important area to manage strategically. ...