Nestle is a company which provides the food products from farm to fork. Its commitment to provide the food product to end users with high quality and value for money has led it to expand globally. How Nestle was established from a little idea to save a child till how it maintains efficient supply chain tail are discussed in this report. To manage the demand planning, how much important is forecasting and procurement activities are mentioned in detail in the report.
The second section consists of literature review and methodology used to research. To help developing the overall process of supply chain management some recommendations are also reviewed at the end. Lowering the cost by directly contacting the farmers will …show more content…
To forecast the demand Nestle should determine the quantity, time, and place. Proper demand management accelerates the planning and use of resources for progressive and beneficial results and may involve marketing plans designed to increase or reduce demand in a relatively short time. If demand is underestimated, sales can be lost due to the lack of supply of goods. If demand is overestimated, the supplier is left with a surplus that can also be an economic drain. A good understanding of demand makes a company more competitive in the marketplace.
• Nestlé improves its forecast accuracy and make multi-million dollar cutbacks in their inventory by removing human arbitration and permitting the predictions of future demand through ‘demand shaping’.
Procurement Activities: Nestle operates with an objective to produce and market food products which satisfy consumer and customer expectation with high food quality and value for money. For this, Nestle buys raw material from farmers and by trade. The procurement approach targets mainly at obtaining the raw supplies in a commercial way to certify providing quality, avoiding delays in the acquisition of resources, and reducing the stock-out.
It is advisable for Nestle to buy the raw material directly from the farmers. As mediators will be removed, it will improve the transparency and will be beneficial with reduced …show more content…
Nestle should start 24/7 transportation system for all of its departments. It will improve the Delivery Execution System, which in turn will be available to the end users as per the demand. There should be centralized load planning and vehicle scheduling.
The above stated recommendations can help Nestle in growing firmly and globally.
In nutshell, being a leading food manufacturer, Nestle believes in commitment for the development of its business. Nestle will take the advantage of its strength in the procurement of raw material in global sourcing to maintain its competitiveness.
Works Cited nestle. (n.d.). igd.com. Retrieved from igd.com: http://www.igd.com/our-expertise/Supply-chain/Strategy-planning-technology/2671/Transport-Technology-User-Guide--Assessment-Tool/Case-Studies/Nestle-Technology-used-to-manage-the-Primary-Transport-operation-in-a-multi-category-business/ nestle. (n.d.). supplychaindigital.com. Retrieved from supplychaindigital.com: http://www.supplychaindigital.com/logistics/3367/How-DemandDriven-Forecasting-paid-off-for-Nestle
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