1) Evaluate the applicability of each of the four approaches to supply chain design (SCOR, Supply chain evolution, nature of the product or service or life cycle) to Lillian?s analysis of the Macaroni and Cheese supply chain.

2) Where should Lillian begin with mapping this supply chain, and why?

Mapping the Mac

As part of her internship project at Global Foods, Lillian Smith was charged with understanding and mapping The supply chain for Global Foods. premium macaroni and cheese. This is the macaroni and cheese that comes with the premixed cheese sauce in a can, rather than the powdered mix in a pouch. The selling point is that the sauce in a can tastes closer to homemade. It is priced at 3 to 4 times more than the macaroni and cheese with powdered cheese mix.

The cost of this product was too hie, according to management. Because it was already Priced at such a premium, marketing believed that there was no way that Global Foods could raise the price of the product to consumers. However the cost increases it was experiencing were squeezing the margins.

Lillian had been given a bill of materials (BOM) for the mix and needed to trace it back to the individual supplier, their subsuppliers, and any subsuppliers. The BOM that Lillian was given appear. in Table 72. The ingredients in each finished box of macaroni and cheese weigh approximately 1 pound (lb). There are 24 boxes in each case, and each case contains about 24 hundredweight (cwt.)of ingredients, not counting the packaging The shrinkage or loss cost are built into the unit cost in the far column.Note that the unit cost are per case of 24 box. The packaging is also converted to a cost per case of macaroni and cheese. Corrugated shippers and cartons are priced per hundred and need to be convened to a case cost. Loss in manufacturing must also be incorporated. The glue is priced per cwt.

Lillian approached one of the product engineers to give her some insight into reading the BOM. The project engineer provided the following definitions:

• Remember that the unit of measure is 1 case of 24 boxes.
• CWT means hundredweight, which is the same as 100 pounds. It is a common measure in food manufacturing and ingredient buying in the United States.

Table 7.2:

Transcribed Image Text:

Table 7.2 Bill of Materials for Premium Macaroni and Cheese Mix 24 Box Case Product Code: 6001 Date of Last Update: 12/20/2004 Approved by: Bill Jenkins, Materials Scientist INGREDIENTS Durum Wheat Pasta Cheese Sauce Mix Ingredient Cost PACKAGING Package Corrugated Shipper Glue (cwt) Packaging Cost Total Material Cost SUPPLIER Noodles-R-Us Stan's Sauces SUPPLIER Brown Boxes Acme Boxes Sticky Wicket CODE 11234 98549 CODE 3567 3678 3925 % WEIGHT Loss 75% 2.00% 25% 0.05% 100% Loss 0.50% 0.02% 2.00% CWT/CASE 0.18240 0.06012 0.24252 UNITS/CASE 24 1 0.00167 COST/CWT $24.00 $300.00 Cost/100 $11.50 $50.05 $78.00 COST/CASE $4.47 $18.05 $22.52 COST/UNIT $2.77 $0.50 $0.13 $3.40 $25.92 Table 7.2 Bill of Materials for Premium Macaroni and Cheese Mix 24 Box Case Product Code: 6001 Date of Last Update: 12/20/2004 Approved by: Bill Jenkins, Materials Scientist INGREDIENTS Durum Wheat Pasta Cheese Sauce Mix Ingredient Cost PACKAGING Package Corrugated Shipper Glue (cwt) Packaging Cost Total Material Cost SUPPLIER Noodles-R-Us Stan's Sauces SUPPLIER Brown Boxes Acme Boxes Sticky Wicket CODE 11234 98549 CODE 3567 3678 3925 % WEIGHT Loss 75% 2.00% 25% 0.05% 100% Loss 0.50% 0.02% 2.00% CWT/CASE 0.18240 0.06012 0.24252 UNITS/CASE 24 1 0.00167 COST/CWT $24.00 $300.00 Cost/100 $11.50 $50.05 $78.00 COST/CASE $4.47 $18.05 $22.52 COST/UNIT $2.77 $0.50 $0.13 $3.40 $25.92

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1 Application of four approaches to supply chain design All the approaches of SC design have some common elements We have indentified the customers an... View the full answer