Cycle View

The processes in a supply chain are divided into a series of cycles, each performed at the interface
between two successive stages of a supply chain.

The below diagram shows the five stages where all the processes of supply chain are divided:

All the cycles might not be present in all kind of product’s supply chain.

Coca Cola in Bangladesh has all the cycles present and these include:

Customer order cycle: This is the process that takes place between the customer and the retailer and
includes all processes directly involved in receiving and filling the customer’s order. Basically, the
customer initiates this cycle at a retailer site by visiting the store and asking for a Coca Cola. The cycle
primarily involves filling customer demand. The retailer’s interaction with the customer starts when the
customer arrives or contact is initiated and ends when the customer receives the order.

Replenishment cycle: It occurs at the retailer/distributor interface and includes all the processes
involved in replenishing retailer inventory. It is initiated when a retailer places an order to replenish
inventories to meet future demand. A replenishment cycle may be triggered at a super-market that is
running out of stock of Coca Cola. This is similar to the customer-order cycle except that the retailer is
now the customer.

Manufacturing cycle: It occurs at the distributor/manufacturer or (sometime retailer/manufacturer)

interface and include all processes involved in replenishment of the distributors (or retailer’s)
inventories. The Coca Cola distributor or wholesaler orders the manufacturing plant for more coca colas
and the manufacturer starts producing more. The manufacturing cycle is triggered by customer orders,
replenishment orders from a retailer or distributor or by the forecast of the customer demand.

Procurement cycle: The procurement cycle occurs at the manufacturer/supplier interface and including
all processes necessary to ensure that materials are available for manufacturing to occur according to
schedule. During the procurement cycle the manufacturer orders more raw materials from suppliers.

Push/Pull View:
Processes in a supply chain are divided into two categories depending on whether they are executed in
response to a customer order (pull) or in anticipation of a customer order (push). Push and pull
boundary separates both the processes. The diagram depicts the push and pull boundary.

Coca cola in Bangladesh and elsewhere around the world uses the push view to sell its products. As push
view depends on the speculation of customer demand it tries to push as many products into the market.
In this they take lot of time to react to the changes in the market. Forecast plays vital role in push view.

Figure: Push view of Coca Cola

Steps of Coca Cola push based model:

 Manufacturing plant of coca cola orders the raw materials from the supplier
 Manufacturer produces coke based on forecasts
 Distributor stores their inventory based on customer demand forecasts
 Retailers keep stock based on forecasts
 Finally, customer purchases from the retail stores on demand.
Benefits Coca cola gets from using push strategy:

1. Push strategy also allows them to plan production to meet their needs and gives them time to
prepare a place
2. Long term forecasting helps the company to manufacture optimum level of products to store
the stock they receive.
3. Drawbacks of using the push strategy:
4. Manager of firm based on push view sometime unable to meet changing demand.
5. Push process result in high inventory and high size of batches.

Drawbacks of Coca Cola using push strategy:

1. Forecasts are often inaccurate as sales can be unpredictable and vary from one year to the next.
2. Another problem with push inventory control systems is that if too much product is left in
inventory. This increases the company's costs for storing these goods.

Coca cola does not wait for customer orders, rather this brand carefully anticipates their customer
demands from forecasting and previous sales in specific locations. They mainly target the metropolitan
areas of Bangladesh as people there are more familiar with coca cola and prefer coca cola more than
any other brands of cola. Demand for coca cola are most of the time high during festive seasons and
summer season and thus, production and supply is also more during these peak times.