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Issues Of Supply Chain Of Beverage Industry In Vietnam

1) QUESTION 1:
a) 5 issues
- Warehouse
+ The quality of warehouse system of supply chain players (farmers) using for storing coffee beans is not good: There are rains during the drying season but the farm-level storage facilities are not enough to protect coffee beans from wet weather. Consequently, the quality of coffee beans can be affected negatively by mould (Minot, 1998)
+ The capacities of warehouses using for finished products are not made use of in the most effective way. Because of lacking management in warehouse operations, utilization of space (utilizing the facility’s height and minimizing aisle space) is not achieved. Also, the placement stock is not paid attention yet in order to minimise labour costs or handling costs in warehouses.

- Information flow and management:
In Vietnam, most of orders of coffee are still treated in the traditional way: via telephone of face-to-face meeting. However, this utility of traditional methods leads to time-consuming and costly results. Some companies have already a website but it is used only for marketing and promotes the products.

- Inventory management:
There is a seasonality of supply of coffee beans in Vietnam: the harvesting season starts from late October and reach the peak in the middle of November each year (Kuwait Times, 2005). However, distributors, wholesalers and retailers of the supply chain do not care about the inventory safety level, they just estimate when they think it is need to replenish, which leads to the overload inventory or stock-out inventory. Sometimes, the overload inventory occurs due to poor demand forecasting or weak inventory visibility.

- Transportation
The mode of transportation distributing coffee beans from farmers to purchasing agent cannot ensure raw material’s quality and safety: Most households use "kong nong” (small locally-made tractors) to transport their dry coffee to private middlemen because of cheap transportation costs. However, that kind of...