a . What is your overall evaluation of the potential for Jordano Foods in this new relationship with SAB? Explain your position. b. What areas of logistics do you think have the most potential for Jordano and SAB to collaborate for the benefit of SAB’s customers? Why? c. What type of logistics channel would you recommend to Jorando Foods? Provide a diagram of the logistics channel you are recommending.Elaborate on why you have selected the specific type of logistics channel. d. How can logistics add value for Jordano Foods and SAB?
Jordano Food Products Supply Chain Profile Jordano Foods Tracie Shannon, Vice President for Logistics at Jordano Foods (Jordano), had sent the following e-mail to members of the executive committee of the company two years ago: I just returned from a lengthy meeting with Susan Weber, CEO ofSAB Distribution. She is under great pressure from her Board ofDirectors to continue to grow market share and improve profitability. SAB received a recent tender offer from another larger food distributor to buy the company and several members of their board have recommended that the offer be seriously considered. Susan feels that SAB can continue to improve their “bottom line” with additional changes in service offerings. Ms. Weber met with SAB’s major suppliers and customers to discuss new services that SAB can offer to enhance the competitiveness ofthe SAB supply chain. She was particularly concerned with the changing demographics oftheir customer base, particularly the Gen-Y and Plus-55 age groups. Background on Jordano Foods Jordano Foods was founded in 1950 in Lewistown, Pennsylvania, by two brothers, Luigi and Mario Jordano. Their parents operated a restaurant in Burnham, Pennsylvania, featuring Italian cuisine. Marie Jordano was famous for her culinary skills. She developed her own recipes for pasta sauce, meatballs, fresh and dry pasta, and other Italian food items. Luigi and Mario worked in a restaurant prior to establishing Jordano Foods. The brothers felt that they could capitalize on the family recipes by selling pasta, sauces, and other related Italian food products to restaurants in nearby communities in central Pennsylvania. Their initial venture was so successful that they expanded their product line and began selling their products to small and medium-sized wholesalers and distributors through-out Pennsylvania. They built a plant in Lewistown to produce their food products and subsequently built another plant in Elizabethtown, Pennsylvania, and a warehouse in Mechanicsburg, Pennsylvania. Current Situation The 1990s and 2000s were times of significant growth for Jordano. Mario and Luigi were still active in the company as president/CEO and chairman of the board, respectively. Revenue now exceeded $600 million per year, and a third plant had been built in the western part of Pennsylvania near Uniontown. A group of professional managers has been developed in the company to head up the major functional areas. Tracie Shannon was hired in 2010 to manage the logistics area which had not received much attention. Tracie realized that the Jordano brothers had managed and developed the manufacturing and
The vision of Susan Weber for SAB had tremendous potential for all members of their supply chain, including Jordano Foods. Now, Tracie has to help orchestrate the transformation of Jordano again to enable them to perform as an important part of the supply chain for SAB Foods. She understood that Jordano has to assist SAB in meeting the challenges of the changing demographics and the competitive threat of the larger chain stores.
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