MBA FPX 5016 Assessment 3 Supply Chain Management Plan

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Capella University

MBA-FPX 5016 Operations Management for Leaders

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Date

MBA FPX 5016 Assessment 3 Supply Chain Management Plan

Wild Dog Coffee Company can successfully expand to a second location by developing a supply chain management plan that ensures consistent espresso quality, reliable ingredient availability, efficient logistics, and cost-effective operations. A well-designed supply chain will help the business coordinate suppliers, inventory, transportation, equipment, and daily coffee preparation across both locations. By comparing centralized and decentralized supply chain designs, identifying logistical bottlenecks, and selecting an appropriate distribution strategy, Wild Dog Coffee Company can support business growth while maintaining customer satisfaction and operational efficiency.

Supply Chain Management Plan for Wild Dog Coffee Company

This supply chain management plan evaluates two possible supply chain designs for Wild Dog Coffee Company as it prepares to open a second location. The analysis considers how supplies move from vendors to each coffee shop, how logistics support daily operations, and how supply chain decisions affect costs, product consistency, and customer service.

The proposed plan follows a presentation structure that can be developed into a PowerPoint presentation. It includes supply chain flowcharts, an evaluation of potential bottlenecks, recommendations for improving logistics, and a justification for the preferred supply chain design.

Slide 1: Introduction to Supply Chain Management

The purpose of this presentation is to develop a practical supply chain management plan for Wild Dog Coffee Company. As the business expands to a second location, management must determine how to source coffee beans, milk, syrups, cups, packaging, and other essential supplies while maintaining consistent espresso preparation.

The presentation examines alternative supply chain designs, evaluates the role of logistics, identifies potential operational challenges, and recommends a strategy that supports growth. The overall objective is to create a reliable, flexible, and cost-effective supply chain that meets customer expectations at both locations.

Slide 2: Business Scenario

Wild Dog Coffee Company is a local coffee business planning to expand by opening a second location. Its growth creates an opportunity to increase sales and reach new customers, but it also introduces additional supply chain responsibilities.

Both locations will need dependable access to coffee beans, milk, flavorings, cups, lids, cleaning supplies, and other operating materials. The company must also maintain consistent espresso preparation standards so customers receive a similar experience regardless of which location they visit.

The central business challenge is deciding whether to manage purchasing and inventory centrally or allow each location to handle more of its own supply chain activities. The selected approach should balance cost efficiency, operational control, responsiveness, and product availability.

Slide 3: Role and Responsibilities

As the owner of Wild Dog Coffee Company, the primary responsibility is to design and implement a supply chain that supports both the existing business and the new location.

This involves selecting reliable suppliers, determining purchasing procedures, establishing inventory policies, coordinating deliveries, and monitoring supply chain performance. The owner must also ensure that employees at both locations follow standardized procedures for receiving supplies, storing ingredients, preparing espresso, and managing inventory.

Effective supply chain management requires coordination between purchasing, transportation, inventory control, and daily coffee shop operations. Establishing clear responsibilities will help the company maintain consistency while preparing for future expansion.

Slide 4: Supply Chain Management Plan Requirements

The proposed presentation will evaluate supply chain alternatives and explain how each design affects Wild Dog Coffee Company’s operational performance.

The presentation should include a comparison of two supply chain scenarios, flowcharts showing the movement of supplies, an analysis of logistics activities, and an assessment of potential bottlenecks. It should also explain how supply chain decisions create value and conclude with a recommended design supported by clear assumptions and academic sources.

The original assignment specifies a 10–12-slide presentation. However, the supplied outline contains 14 slides, including the appendix and question-and-answer section. To meet the assignment requirements, the final PowerPoint should consolidate the material into 10–12 slides unless supplementary slides are permitted separately.

Slide 5: Analysis of Two Supply Chain Designs

Wild Dog Coffee Company can consider two primary supply chain designs: a centralized supply chain and a decentralized supply chain. Both approaches can support a two-location business, but they differ in purchasing control, inventory management, delivery coordination, and operational flexibility.

Supply Chain Design 1: Centralized Purchasing and Inventory Management

Under a centralized supply chain design, the owner manages purchasing and coordinates inventory for both coffee shop locations. Suppliers deliver ingredients and operating supplies to a designated storage or distribution point, from which supplies are allocated to each location.

Supply chain flowchart:

Suppliers → Central Storage or Distribution Point → Existing Coffee Shop and New Coffee Shop → Espresso Preparation and Customer Service

This design allows the company to combine orders, standardize purchasing procedures, and maintain consistent product specifications. Purchasing larger quantities may improve supplier pricing and reduce duplicated administrative work, depending on order volumes and supplier terms.

Centralized management also makes it easier to monitor total inventory, compare supplier performance, and implement consistent quality standards. However, the business may face additional handling, storage, and transportation costs when supplies must be redistributed from a central location.

A further risk is dependence on a single distribution point. If that location experiences a stock shortage, equipment problem, or delivery delay, both coffee shops may be affected.

Supply Chain Design 2: Decentralized Purchasing and Inventory Management

Under a decentralized supply chain design, each coffee shop manages more of its own purchasing, inventory, and supplier deliveries. The owner may still establish company-wide supplier standards and product specifications, but individual locations handle their routine supply requirements.

Supply chain flowchart:

Suppliers → Existing Coffee Shop → Espresso Preparation and Customer Service

Suppliers → New Coffee Shop → Espresso Preparation and Customer Service

This approach allows each location to respond directly to its customer demand, storage capacity, and operating schedule. The new coffee shop can adjust orders according to its sales patterns without waiting for supplies to be redistributed from another location.

However, decentralized purchasing may result in duplicated administrative work, inconsistent ordering practices, and reduced purchasing leverage. Differences in supplier selection or ingredient specifications could also affect product consistency.

To reduce these risks, Wild Dog Coffee Company should establish common purchasing standards and approved supplier lists even if individual locations manage their own inventory.

Comparing the Two Supply Chain Designs

Evaluation criterion	Centralized design	Decentralized design
Purchasing control	Managed centrally	Managed primarily by each location
Inventory visibility	Easier to monitor across locations	Requires separate tracking and consolidation
Purchasing efficiency	May benefit from combined orders	May involve smaller, separate orders
Responsiveness to local demand	May require additional coordination	Generally offers greater local flexibility
Transportation requirements	May require redistribution between locations	Suppliers deliver directly to each location
Risk of operational disruption	A central disruption may affect both locations	A disruption may be more localized
Standardization	Easier to enforce common procedures	Requires strong shared policies
Administrative workload	Potentially lower overall duplication	Potentially higher due to separate ordering
Best suited for	Businesses prioritizing control and purchasing coordination	Businesses prioritizing local autonomy and responsiveness

The most appropriate design depends on supplier delivery options, the distance between locations, product shelf life, available storage, demand patterns, and the cost of transportation. These factors should be evaluated before the company commits to a final arrangement.

Slide 6: How Supply Chain Management Intersects With Logistics

Supply chain management and logistics work together to ensure that products move efficiently from suppliers to customers. Supply chain management covers the broader coordination of sourcing, purchasing, inventory, supplier relationships, and operational planning. Logistics focuses more specifically on transportation, storage, handling, delivery schedules, and the movement of goods.

For Wild Dog Coffee Company, logistics begins when suppliers prepare orders of coffee beans, milk, syrups, cups, and other supplies. The products must then be transported to the correct location, received by employees, inspected for quality, and stored under appropriate conditions.

In the centralized design, logistics includes deliveries to the central storage point and any subsequent transportation between coffee shops. The company must coordinate delivery schedules, maintain suitable storage conditions, and ensure that each location receives the correct quantities.

In the decentralized design, suppliers deliver directly to each coffee shop. This may reduce the need for internal redistribution, but it can create additional delivery coordination requirements and potentially increase transportation costs if each location places small orders independently.

Regardless of the selected design, Wild Dog Coffee Company should establish clear receiving procedures, inventory records, delivery schedules, and storage requirements. Milk and other perishable ingredients require particular attention to temperature control and product rotation.

Gligor and Holcomb (2012) discuss the relationship between logistics capabilities and supply chain agility. For Wild Dog Coffee Company, effective logistics can improve responsiveness by helping each location obtain the supplies needed to meet changing customer demand.

Slide 7: Identifying and Overcoming Supply Chain Bottlenecks

Supply chain bottlenecks occur when a constraint slows the movement of products or prevents an organization from meeting demand. For Wild Dog Coffee Company, potential bottlenecks include supplier delays, inaccurate inventory records, insufficient storage, transportation problems, and inconsistent purchasing practices.

Supplier Delays and Limited Availability

A supplier delay can interrupt espresso preparation or prevent employees from fulfilling customer orders. Dependence on a single supplier for essential coffee beans, milk, or packaging may increase this risk.

The company should establish relationships with dependable suppliers and identify approved alternatives for critical products. Supplier performance should be evaluated through delivery reliability, product quality, pricing, and responsiveness when problems occur.

Inventory Shortages and Overstocking

Poor inventory management can lead to shortages of essential ingredients or excessive purchases that tie up cash and create waste. Perishable products are particularly vulnerable to spoilage when orders exceed actual demand.

Wild Dog Coffee Company should establish minimum and maximum stock levels for essential items, review inventory regularly, and use sales records to estimate future demand. First-expiring, first-out (FEFO) procedures should be used for perishable products when appropriate so that items with earlier expiration dates are used first.

Transportation and Delivery Challenges

Delivery delays can affect operations when supplies arrive too late or are delivered to the wrong location. Centralized redistribution may create additional handling and transportation requirements, while decentralized purchasing may result in several small deliveries.

The company should coordinate delivery schedules with suppliers, consolidate orders when practical, and maintain clear procedures for confirming quantities and reporting missing or damaged products.

Inconsistent Espresso Preparation

Supply chain efficiency alone cannot guarantee a consistent customer experience. Differences in coffee beans, milk, recipes, equipment settings, or employee practices may result in inconsistent espresso quality across locations.

Wild Dog Coffee Company should standardize approved ingredients, espresso recipes, equipment calibration, employee training, and quality checks. These measures will help both locations deliver a consistent product even when their inventory and delivery arrangements differ.

Limited Communication Between Locations

Poor communication can result in duplicate orders, unexpected shortages, and inconsistent purchasing decisions.

A shared inventory management system or standardized digital spreadsheet can help the owner and employees monitor stock levels, record purchases, and identify emerging supply issues. Regular communication between locations can further improve coordination and accountability.

Slide 8: How Supply Chains and Logistics Create Business Value

An effective supply chain creates value by ensuring that the right products are available at the right time, in the right quantities, and at an appropriate cost. For Wild Dog Coffee Company, these benefits extend beyond purchasing and inventory management to include customer satisfaction, product quality, employee productivity, and profitability.

Reliable supply availability helps prevent menu disruptions and lost sales. Consistent ingredients and standardized purchasing procedures support a uniform customer experience across both locations. Efficient logistics can also reduce unnecessary transportation, storage, and handling costs.

Demand planning is particularly important as the company expands. Historical sales, seasonal changes, promotions, weather patterns, and local customer preferences can help the owner estimate future requirements. These estimates should be updated as the new location develops its own sales history

MBA FPX 5016 Assessment 3 Supply Chain Management Plan

Inventory decisions should reflect the different characteristics of each product. Coffee beans and shelf-stable packaging may be suitable for larger orders when storage capacity and demand justify them. Fresh milk and other perishable ingredients generally require more frequent replenishment and careful monitoring.

Supply chain management can create additional value through stronger supplier relationships. Reliable communication may help the company resolve shortages, coordinate delivery schedules, and negotiate appropriate purchasing terms. However, cost reductions should not come at the expense of product quality, food safety, or supplier reliability.

Chopra and Sodhi (2014) emphasize the importance of reducing supply chain disruption risks. Wild Dog Coffee Company can apply this principle by maintaining contingency plans, identifying alternative suppliers, monitoring inventory risks, and preparing for unexpected interruptions.

Slide 9: Recommended Supply Chain Design

For Wild Dog Coffee Company’s initial expansion to a second location, a hybrid supply chain design is recommended. This approach combines centralized purchasing standards and inventory oversight with direct supplier deliveries to each coffee shop whenever practical.

Under this model, the owner would negotiate supplier arrangements, approve product specifications, establish purchasing policies, and monitor total inventory across both locations. Suppliers would deliver products directly to the location that needs them when direct delivery is reliable and cost-effective. Selected nonperishable products could be purchased in combined quantities or stored centrally if doing so creates measurable savings.

This recommendation avoids the need to establish a separate distribution facility immediately while maintaining control over product quality and purchasing decisions. It also allows each coffee shop to respond to local demand without sacrificing company-wide standards.

MBA FPX 5016 Assessment 3 Supply Chain Management Plan

The hybrid approach should be adjusted according to the company’s actual operating conditions. If the locations are close together and suppliers cannot deliver to both efficiently, limited transfers between stores may be practical. If the locations are far apart, direct supplier deliveries may be more effective.

The recommendation is supported by four considerations. First, centralized purchasing standards can improve consistency and simplify supplier management. Second, direct deliveries can reduce unnecessary internal handling. Third, shared inventory oversight can help prevent shortages and overstocking. Fourth, local demand monitoring allows each location to adjust orders as customer patterns change.

The company should evaluate the design after implementation by monitoring supply costs, delivery reliability, inventory waste, stockouts, customer satisfaction, and product consistency. These measures will help determine whether the hybrid model is achieving its intended benefits.

Slide 10: Assumptions Supporting the Recommended Design

The recommendation is based on several assumptions because detailed operational information about Wild Dog Coffee Company has not been provided.

First, the company is assumed to operate two coffee shop locations with similar espresso menus and comparable core ingredient requirements. This makes shared purchasing standards and inventory oversight practical.

Second, the business is assumed to have access to suppliers capable of delivering directly to both locations. If direct delivery is unavailable or too expensive, the company may need to evaluate a shared storage location or scheduled transfers.

Third, the recommendation assumes that the owner can maintain a shared inventory record covering both locations. A digital inventory system, point-of-sale reporting, or standardized spreadsheet could support this process, depending on the company’s budget and transaction volume.

Fourth, the plan assumes that each coffee shop has sufficient storage for routine supplies, including appropriate refrigeration for perishable products. Storage limitations may require more frequent deliveries or changes to order quantities.

Fifth, the company is assumed to prioritize consistent espresso quality, reliable customer service, and responsible cost management rather than pursuing the lowest purchase price alone.

Finally, the recommendation assumes that the company will review performance regularly and modify purchasing and logistics procedures as actual demand becomes clearer. The new location’s early sales may differ from forecasts, making frequent monitoring especially important.

Slide 11: Conclusion and Strategic Recommendations

Wild Dog Coffee Company’s expansion requires a supply chain that supports consistent espresso preparation, reliable product availability, and efficient operations across two locations. Centralized and decentralized supply chain designs each offer advantages, but neither is ideal in every situation.

A hybrid model is recommended because it combines company-wide purchasing standards and inventory oversight with direct deliveries and location-specific demand planning. This approach can support product consistency while avoiding unnecessary transportation and handling where direct supplier delivery is practical.

The company should prioritize supplier reliability, inventory accuracy, demand forecasting, employee training, and contingency planning. Performance should be monitored through indicators such as stockout frequency, ingredient waste, delivery reliability, supply costs, and customer satisfaction.

By aligning purchasing decisions with logistics and operational requirements, Wild Dog Coffee Company can establish a more reliable supply chain and create a strong foundation for future growth.

Slide 12: References

The presentation should use scholarly and credible sources to support its discussion of supply chain design, logistics, inventory management, disruption risks, and business value. APA-style in-text citations should appear on the relevant slides, with complete references included on the final reference slide or slides.

The following sources provide a foundation for the analysis.

Frequently Asked Questions

What is the best supply chain design for Wild Dog Coffee Company?

A hybrid supply chain design is a practical starting point for a two-location coffee business. It combines centralized purchasing standards and inventory oversight with direct supplier deliveries and location-specific demand planning. The final design should depend on supplier capabilities, delivery costs, storage capacity, and the distance between locations.

Why is demand planning important for a coffee shop?

Demand planning helps a coffee shop estimate how much coffee, milk, syrup, packaging, and other supplies it will need. Accurate forecasts can reduce stockouts, prevent excessive inventory, limit spoilage, and improve purchasing decisions.

What is the difference between centralized and decentralized supply chains?

A centralized supply chain coordinates purchasing and inventory decisions through a central management function. A decentralized supply chain gives individual locations greater responsibility for ordering and managing their supplies. Centralization may improve purchasing coordination, while decentralization may improve responsiveness to local demand.

How does logistics affect coffee shop operations?

Logistics coordinates the transportation, delivery, storage, and handling of supplies. Efficient logistics helps ensure that ingredients arrive on time, are stored appropriately, and are available when employees need them to prepare products for customers.

What are common supply chain bottlenecks for coffee shops?

Common bottlenecks include supplier delays, ingredient shortages, inaccurate inventory records, insufficient storage, transportation problems, and inconsistent communication. Standardized purchasing procedures, reliable suppliers, inventory monitoring, and contingency plans can help reduce these risks.

How can Wild Dog Coffee Company maintain consistent espresso quality across two locations?

The company should standardize coffee bean specifications, espresso recipes, equipment settings, employee training, and quality checks. Shared purchasing standards and regular communication can help both locations follow the same preparation procedures.

Which performance indicators should Wild Dog Coffee Company monitor?

Useful indicators include stockout frequency, inventory turnover, ingredient waste, supplier delivery reliability, purchasing costs, order accuracy, and customer satisfaction. Tracking these measures can help the owner identify problems and improve supply chain performance over time.

References

Chopra, S., & Sodhi, M. S. (2014). Reducing the risk of supply chain disruptions. MIT Sloan Management Review, 55(3), 73–80. https://sloanreview.mit.edu/article/reducing-the-risk-of-supply-chain-disruptions/

Gligor, D. M., & Holcomb, M. C. (2012). Understanding the role of logistics capabilities in achieving supply chain agility: A systematic literature review. Supply Chain Management: An International Journal, 17(4), 438–453. https://doi.org/10.1108/13598541211246594

MBA FPX 5016 Assessment 3 Supply Chain Management Plan

Krajewski, L. J., Malhotra, M. K., & Ritzman, L. P. (2019). Operations management: Processes and supply chains (12th ed.). Pearson.

Madhani, P. M. (2017). Customer-focused supply chain strategy: Developing business value-added framework. IUP Journal of Supply Chain Management, 14(4), 7–22.

Simchi-Levi, D., Clayton, A., & Raven, B. (2013). When one size does not fit all. MIT Sloan Management Review, 54(2), 15–17.