You are the new supply chain and vendor risk manager for Ethical Coffee, Inc. Sketch of Ethical
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Question:
- You are the new supply chain and vendor risk manager for Ethical Coffee, Inc.
- Sketch of Ethical Coffee's Supply Chain
- Ethical coffee purchases green coffee from farmers in Colombia, Costa Rica, Yemen, Saudi Arabia, Ethiopia, and Papua New Guinea.
- After its local agents (all independent contractors) have sourced and purchased the coffee beans, Ethical Coffee contracts to transport the beans to the closest suitable shipping port.
- Ethical Coffee also contracts with port warehouses to store the coffee until the shipping date.
- Ethical Coffee enters into contracts with container ship companies to have the beans shipped to New York, San Francisco, or New Orleans.
- Once the beans arrive in the U.S., they are transported by truck and/or train to the company's 5 regional roasting plants.
- After the coffee beans are roasted, they are packaged and shipped to grocery stores and to Ethical Coffee's 10,000 coffee shops.
- The company's founder recently sold Ethical Coffee, Inc. to a retired Wall Street investment banker, who loves coffee but has little knowledge of the coffee industry.
- As a result, the new owner has asked you to discuss the vendor and third party risk management issues in the following 3 areas:
1. Green Coffee - Ethically Sourced Coffee and Blockchain Technology
- Describe:
- At least three potential "fairtrade/ethical-coffee" operational and reputational risks faced by the company, and
- The "fairtrade" certification process, as well and two other types of "ethical coffee" certifications.
- Discuss the costs and benefits of adopting blockchain technology to:
- Increase the overall efficiency of the company's coffee supply chain, and
- Reduce fairtrade/ethical-coffee operational and reputational risks
2. Warehousing and Storage Risk Management
- Discuss the warehousing and storage risk management issues in the coffee supply chain.
3. Shipping of Coffee - Transportation Risks
- Describe how the COVID pandemic affected the shipment by sea of coffee beans to the United States.
- Identify at least two ways to reduce the risks associated with shipping coffee beans to the United States.
Related Book For
Operations Management Processes And Supply Chains
ISBN: 9781292409863
13th Global Edition
Authors: Lee Krajewski, Naresh Malhotra, Larry Ritzman
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