Term Paper (Advanced seminar), 2012
12 Pages, Grade: A
Logistics and Supply Chain
Logistics Support Operations
Impacts and Risks
Cocoa Supply Chain Risks
Identification of Best Practices
Supply Chain Policies and Management Systems
In today’s world, people live in a world in which the range and variety of products from across the world which we consume are taken for granted. Logistics and Supply Chain Management have played an input role in allowing us an almost unlimited amount of choice in the food and drinks we consume (Waters, 2009; pp. 45). Fresh fruit and vegetables from every continent are available in Supermarkets. Clothing, electronic equipment and gadgets from China, Japan, Korea etc are available at prices far lower in real terms than ever before. Behind every one of these products is a Supply Chain, sometimes highly complex with flow of materials across numerous continents and some relatively simple. Besides, the divine Chocolate was set up by cocoa farmers with the aim of improving their sustainability and equity in the chocolate supply chain. In the process of production, the company invests in farmers is miniature compared to big players. Nonetheless, all the investments are substantial as part of its chocolate sales. This paper undertakes to provide an analysis of the of the end to end supply chain of Cadbury milk chocolate. This is done through highlighting on numerous issues such as the role of logistics, supply chain management, among others.
Slack (2009, pp. 57) asserts that it is important to note that in answering to public call; most chocolate firms have decided to work on developing their supply through joining initiatives that insists on addressing several social issues. Some of the issues that such companies must address are under development, poverty, among others. These are some of the issues that push for the perpetuation of child labor in the supply chain of cocoa (Booth, 2010, pp. 23). The companies have also decided to focus on developing a more suitable, sustainable and equitable cocoa supply chain. The best supply chain will ensure that all the issues both for small and big players are solved through integration of a multi-stakeholder stratagem to address both social and environmental issues. Ideally, a sustainable cocoa supply chain will ensure that the partakers are treated with utmost respect and remunerated with better income. The partakers include those taking part in cultivation, harvesting, and processing of cocoa in the companies. The reasons why they must be given something they will support their livelihood is because it will aid in avoiding cases of child labor in the supply chain management.
According to Murphy and Wood (2010, pp.56) every organization is always faced with the duty of moving materials. In the chain, there are manufacturers who their companies engage in the process of collection of raw materials. The raw materials come from the suppliers and delivered as finished goods to the consumers. Retails shops get the goods they sell from wholesalers. This can be compared to the television news service that collects reports from all over the globe and delivers them to their viewers. Most people stay in towns without knowing the process that food industries go through before they deliver a finished product to the consumers. It is important to note that at times, goods may go through a broader chain of supply before it reaches its destiny. This kind of movement is facilitated through logistics. In that regard, it is noteworthy that logistics facilitates all the aspects of movement and storage of materials on their journey from original supplier finally to the consumers (Christopher, 2010: 23).
On an international scale, an enormous effort is required for logistics. For instance countries like China has become one of the largest supplier in world, and currently they export good estimated to cost roughly US$ 120 billion yearly. Despite all these, many still hardly notice logistics as it goes about its business.
It is true that all organizations deliver final products to their clients. Conventionally, such products are described as either goods or services. Manufacturers like the cocoa company make tangible goods, which in most cases are described as complex package products that contain both goods and services (Waters, 2009, pp. 77). The company producing chocolate also provides a combination of goods. Below diagram shows the percentage breakdown by global milling capacity of cocoa.
Cocoa products usually move through a long and multifaceted supply chain consisting of collectors, exporters, traders, processors and manufacturers before they hit store shelves. The coca bean is grown naturally on small family farm that apply manual practices. It is approximated by the International Cocoa Organization (ICCO) that about 90% of the world’s cocoa is produced by 3,000,000 such smallholders. Production of cocoa hires about 15,000,000 people all over the world with Western Africa alone hiring 10.6 million people. The world supply of cocoa is dominated by four countries from Western Africa including Cameroon, Nigeria, Cote d’Ivoire and Ghana by producing about 70% of the world’s cocoa beans. The two largest world producers are Ghana and Cote d’Ivoire accounting for 56% of all traded coffee (Lysons, & Farrington, 2005, pp. 129).
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