Critical success factors contributing to the success
It is important to note that business by its nature is very competitive world over and thus each one requires a unique selling point to outsmart the competitors. Italian point ventured into the Vietnam market with its coffee brand which the company has managed to sustain substantial profits from the business. Ideally, Italian Point produces high quality coffee that has kept the customers asking for more. In addition, the company packages its coffee in classic espresso cup that has also made the customers to like the experience.
Moreover, Italian Point has diversified its coffee products into four categories including the Whole Bean, Capsules, Coffee Pods, and Ground Coffee each with a unique characteristic. Notably, this divaricating has enabled the company to reach out to a larger market as different customers find their preference in any of the categories listed. Indeed, providing customers with a variety of products in the market increases the number of sales in that a consumer might develop the interest in more than one type and ends up shopping for multiples varieties of the same product thus increasing the number of sales.
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Overall, the packaging of the Italian Point coffee products alongside the provision of the four varieties stand as the most significant strengths for the company. In addition, the quality of the product also helps the company to stay on top of the competition at all times. Ideally, customers shop out for quality and would like to get quality for their money at all times. The high quality of the Italian Point coffee gives value for money. It is important to note that when customers receive value for their money, then they tend to build loyalty for the product and it becomes very challenging for another product to dissuade them, and that stands as one of Italian Point strongest selling advantage.
Warehousing and Inventory of Italian Point Supply Chain
The Italian point company handles different varieties of imported coffee from various parts of the world. The imported coffee is specifically stored in the warehouses to bridge the gap between the fluctuations in the demand and supply of the product. This establishes a constant availability of the products in the market even during low production seasons from the producing countries. The coffee berries are stored in well maintained warehouses in order to keep them free from moisture, oxygen and heat which are the biggest killers (Baskerville, 2010). Since the company has a number of manufacturing plants in different regions, each plant has its own warehousing facilities. Several firms have also ventured into the business of transportation and distribution of coffee from different parts of the world. A good example of such companies is the Romani which has been accredited by Coffee Terminal Market to operate as a warehouse and forwarding firm (Romanige, 2015). Coffee bars have their own small storage facilities.
The processed coffee is distributed to bars all over the country and also beyond the borders to foreign states. Some of the suppliers include the Mokabar and La Pavoni. Its coffee products includes Danesi coffee, Cerini Coffee, Mauro-De Luxe- Espresso beans and Intenso Forte Espresso coffee among others. These different brands of coffees are made using machines produced mainly by La Pavoni Company. Some of these machines include the Europiccola machines, Vintage la Pavoni Espresso Machines, vintage La Pavoni Carina grinding machine and pressure gage (La Pavoni, 2013). The Italian point company obtains coffee from the Mokabar Company and processing machines from La Pavoni company. These machines are used for various production phases which include but not limited to roasting, blending and packing different coffee varieties to come up with a top notch brand of coffee.
Challenge faced by Italian Point’s Supply Chain Management Operations
As earlier mentioned the SCM operations for the Italian Point is a lengthy process because coffee is not grown in Italy but imported from other countries such as Brazil, South Africa, India as well as Bolivia. All these processes require modern means of transport to ensure customers get their products on time. Therefore, the main challenge Italian Point’s SCM operation face is delays in transporting the coffee beans and the roasted coffee. Coffee is always grown in a large scale which means that farmers need modern means of transport to transport the coffee beans to the Italian Point where they are roasted and packaged. Being a Vietnamese coffee company, Italian Point’s SCM is tasked with the role of importing materials from their main suppliers Mokabar and La Pavoni.
In order to meet customer’s demand, Italian Point’s SCM is required to distribute the products directly in Vietnam. At this stage, transporting the products becomes the main challenge that affects Italian Point’s SCM operations. In this case, the company’s SCM is forced to deliver the products using a delivery team or transport agents such as Nasco, Viettel, and DHL. Ideally, the use of delivery teams or transporting agents it quite expensive for the company because of the costs incurred. Whenever the demand for the roasted and packaged coffee increases, the SCM of Italian Point is forced to use alternative means of transport such as the use of motorbikes or cars to reach out to their customers (Fernie and Sparks, 2014). Overall, the company spends a lot of money on transport instead of concentrating on the quality of the products being produced. Therefore, if the company can improve the means of transport, then the quality of the products can be enhanced to meet the customer’s needs.
- Baskerville, P., 2010. Quora: What is the best way to store roasted espresso beans so that they stay fresh? [Online] (updated on 22 June 2010)Available at: https://www.quora.com/what-is-the-best-way-to-store-roasted-espresso-beans-so-that-they-stay-fresh [Accessed on 23 March 2018].
- Fernie, J. & Sparks, L., 2014. Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan page publishers
- Ebay, 2013. La Pavoni. [online] Available at: http://www.ebay.com/bhp/la-pavoni. [Accessed on 23 March 2018].
- Romanige, 2015. The company. [online] (updated in 2015) Available at: http://www.romanige.it/en/company. [Accessed on 23 March 2018].
