Barilla Case Study

In: Business and Management

Submitted By britfam153
Words 1953
Pages 8
CASE: Barilla SpA (A)

I.Overview of the Case

Barilla SpA (Barilla) is a renounced Italian manufacturer that sells several brands of pasta to retailers mainly through third-party distributors. The company was founded in 1875 by Pietro Barilla in Parma, Italy, on Via Vittorio Emanuele. The company passed through the hands of generations from Pietro to his son Ricardo, then to his sons, Pietro and Gianni. The sons “drove the Barillas deeply into debt”; in 1971 the company was sold to a U.S. firm, W.R. Grace, Inc. (Book, 144). Not able to see a profit with their investment, Grace sold the company back to Pietro Barilla. During the 1980s, Barilla relished in an “annual growth rate of 21 percent” with 35 percent being sold in Italy and 22 percent sold Europe. Barilla progressed into a highly vertically integrated company operating flour mills, pasta plants and fresh bread plants as well as distribution warehouses.

With growth, there are falls… Barilla was experiencing problems in the manufacturing and distribution systems caused by fluctuations in demand. Giorgio Maggiali, Director of Logistics became extremely frustration with the situation. Mr. Maggiali tried to implement the just-in-time distribution (JITD), which was proposed earlier by his predecessor, Brando Vitali. It was an up-hill battle because “Barilla’s customers were simply unwilling to give up their authority to place orders as they pleased” and did not share their sales data which would have assisted in forecasting and delivering the appropriate amount of products to distributors. The battle was not just with customers’, but with their own organizations sales and marketing.

Due to pasta having a seasonality demand, in the late 1980’s, Barilla began to flatten out, but by the 1990s, Barilla’s two main pasta brands (semolina and fresh pasta) began to show an increase and the…...

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