NALYZING THE KELLOGG'S CASE

In our lesson, we were asked to read the Kellogg's case study, answer the following questions and add a
discussion of our own. So here's my work!

1. Name the three sectors of the supply

chain. On what occasions could certain sections

of the primary sector operate as retailers?

The three sectors of the supp

ly chain are; the primary sector, which provides raw materials, the secondary sector, which
manufactures and constructs finished and usable products, and the tertiary sector -also known as the
“service sector”- provides service to private and corporate customers.

Generally, the businesses in the tertiary sector operate as retailers; however, in some cases, certain
sections of the primary sector can operate as retailers. For instance, if a customer requests for an
unmanufactured product, he/she will obtain it -the raw material- from the primary sector; enabling this
sector to operate as retailers. The raw material will be taken from the suppliers, this trade making the
suppliers who belong to the primary sector operate as retailers without the need of the tertiary sector.

2. Give three examples of how Kellogg’s demonstrates good supply chain management. How can
Kellogg’s make improvements both for its business and for the environment?
Kellogg’s is able to balance each section of the supply chain successfully and has built good relationships
with each sector. First of all, Kellogg’s chooses the products to be manufactured according to its
customer needs based research, therefore makes sure that the product is right. Secondly, its “just-in-
time” system makes the supply chain better since this system includes computer-based systems, which
provide efficient stock inventories. Third of all, since their storage is 1 mile away, Kellogg’s diminishes
the transportation cost while natur

ally increasing the distribution rate. To sum up, the reason why Kellogg’s has a good supply chain is that
it can choose the right product, keep stocks in the lowest level while keeping the distribution and
customer satisfaction at highest levels.

Moreover, Kellogg’s is a company that can both make profit and realize the importance of its
environment at the same time. Therefore, to make improvements in these fields, Kellogg’s should
achieve its aims by reducing the energy to manufactured products, producing recyclable packaging,
lowering overhead sand unit costs and reducing its carbon footprints. By performing these actions,
Kellogg’s will be making improvements for its business and the environment.

3. Why is it important for Kellogg’s to build good relationships with businesses in the tertiary sector?
Since it’s the tertiary sector that will promote and sell Kellogg’s products, it

is essential that Kellogg’s has good relationships with them. The tertiary sector is where the retailers are

, is the one that will determine its profit rate. Having a high esteem, permanent and strong relationships
with the retailers will contribute to Kellogg’s and increase it’s sales proportion.

4. Evaluate the benefits of large manufacturers like Kellogg’s handing over the logistical side of their
business to specialist companies like TDG.

By handing over the logistical side of their business to specialist companies such as TDG, Kellogg’s can
transport, distribute and store its products much more easily. Also, because it has a more efficient
distribution system, Kellogg’s can focus on its merchandise better, and therefore, be more successful.
Additionally, the specialist companies such as TDG which ensure that the shelves are always full and that
more products are being transported at the same time, provide Kellogg’s to keep stocks to a minimum
and help contribute to its environment by reducing the co2 emission since there are less vehicles
carrying the products. Companies such as TDG increases Kellogg’s profits and contribute to the
environment.

My point of view:

Before reading this article, I looked at Kellogg’s as only a cereal box. After reading it, I discovered a
whole new side of this huge company. I’ve depicted a picture in my mind of how a good company should
be managing the sectors, having good relationships with its retailers while caring so much about the
environment. At first, I was surprised to see that such a big company needed other companies’ help. But
after reading the whole article, I saw that without the help of different companies in each sector,
Kellogg’s could not manage to become the biggest and most successful in its field. I realized that even a
great company needs support and consultancy, which actually made it become great. Thereby, with this
method, every company can focus on its expertise area and by combining these skills, the most profits
can be made.

Besides, before reading this article, I knew that because of global warming, most of the companies were
trying to contribute to its environment. But I was a little bit surprised seeing the extra efforts Kellogg’s
was making, such as stocking its products in a close area to reduce the energy use, or using lean
production to eliminate the waste. I understood that even one company could make a difference in this
world, which made me more hopeful about the future of the earth.