Supply chain from manufacturing to shelf
A Kellogg's case study

Page 1: Introduction

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The Kellogg's Cornflake Company began in 1906 with the Kellogg brothers who originally ran a sanatorium in Michigan, USA. They experimented with different ways to cook cereals without losing the goodness. Their philosophy was 'improved diet leads to improved health'. Between 1938 and the present day Kellogg's opened manufacturing plants in the UK, Canada, Australia, Latin America and Asia...
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Page 2: The supply chain

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The industrial supply chain consists of three key sectors: Primary sector (or extractive) - providing raw materials such as oil and coal or food stocks like wheat and corn. Some raw materials are sold immediately for consumption, such as coal to power stations. Others are used further up the supply chain to be made into finished goods. Secondarysector (or manufacturing) industries...
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Page 3: The supply chain - the secondary sector

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Kellogg's is a secondary sector business. It obtains its raw materials of wheat, corn, cocoa, rice and sugar from primary suppliers around the world. These materials help make over 40 different breakfast cereals and snacks to sell to customers through the tertiary sector. It is a large-scale manufacturer and stores sufficient stocks to meet customer orders. As part of its Research and...
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Page 4: The supply chain - the tertiary sector

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The final stage in the industrial supply chain is the tertiary sector. The tertiary sector provides services. It does not manufacture goods. This sector involves: retailers like supermarkets that purchase manufactured goods from secondary sector businesses and sell them to the consumers service companies who may deal in, for example, finance, computer systems, warehousing or...
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Page 5: Managing the supply chain effectively

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Having the right marketing mix ensures businesses have the right product, in the right place, at the right time. Kellogg's manufactures the right products based on research into consumer needs. It manages the distribution channels to place its products in stores. Its focus on cost-effective systems ensures its prices are competitive. It works with retailers to improve promotion of its products...
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Page 6: Conclusion

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The three sections of the industrial supply chain need to interact to ensure goods or services reach consumers. The efficient delivery of the product to the consumer at the right price, in the right place and at the right time will result in good business for each link of the chain. This takes strategic planning and effective collaboration with all partners. Specialisation is more...
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