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Garland Chocolates
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Transcript
Garland Chocolates
By: Abdullah Elias Jemal
Citation
START
Background
- Headquartered in the UK
- Shanti Suppiah, Director of Operations
- 20 product lines
- $3 Billion revenue
Background
- North American market
- Chocolate product is Edgeworth Toffee
- Two process:-manufacturing and packing
Goal
- Keep customer line fill rate at 98 percent
- Deliver with best quality and accuracy
- Align operations strategy with overall company strategy
Goal
- Redesign Edgeworth Toffee packing to increase sales
Current Situation
- Manufacturing and packing lines have outlived their lives
- Declining margins of Edgeworth Toffee brand
Current Situation
Analysis
- Risk of replacement Vs. Risk of outsourcing both lines
- Alignment of the organization's strategy - Quality and Control
- Decline in sales of Toffee brand Vs. New marketing strategy
Analysis
Alternatives
Alternative A
Alternative B
- Replace both lines
- Outsource both manufacturing and packing lines
Alternatives
- Incorporate a total cost of $740,000
- Get rid of replacement cost
- Lose control over production
- Have full control over production
- Align with company's strategy of ensuring customer service
Recommendation
Factors that need to be considered for decision
- Control
- Delivery
Decision
- Quality
It is recommended that Alternative B is the best option.
- Director Shanti should replace the lines by ensuring the company's strategy.
- Line fill rate would be kept at 98 %.
- Product redesign to increase sales is also recommended
Citation
Johnson, P Fraser. "Chapter 5, Case 5-1 (Garland Chocolates). "Purchasing and Supply Management, sixteenth ed., McGraw-Hill Education, 2020, pp. 132-134
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