Barilla SPA


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Barilla SPA

As can be learned from the case study, the standard deviation for dry pasta is nearly as high as the mean and because of this, Barilla experienced lumpy demand that fluctuates and this is contributed by the volume of discount offered by the company, long wait times, and lack of minimum or maximum order requirement per order. However, the manufacturing plant does not change with the changes in demand since the plant’s customers were simply unwilling to give up their authority to make orders as they are pleased. In this case, the authority of the customers to place order as they are pleased was not strong since some of them were reluctant to offer the detailed sales data upon which the company could make delivery decisions to enhance demand forecasts. Basically, the more disconcerting was the internal resistance from the company’s own sales as well as marketing organizations, which saw the concept as not viable or dangerous Barilla SPA The idea of the company changing wit the change in demand was discarded as simply unworkable. This shows that the company could not be able to change its management and operations since customers had a lot of influence on the demand of the company’s products.

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Discount on full truck load (between 2 and 3percent) motivated distributors to purchase more than they needed which lead to the next order being significantly lower and fluctuations in order quantities. Additionally, the variation in demand causes Bullwhip effect in the entire supply chain. All these factors can be indicated as underlying drivers seen in the case study.